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ELEMENTARY   TEXTBOOK 

AND 

ABRIDGED  MANUAL  OF 
INFORMATION  AND  SUGGESTIONS 

For  Field  Representatives 
of  the 

Massachusetts  Mutual 

LIFE  INSURANCE  COMPANY 

SPRINGFIELD,  MASSACHUSETTS 


By  Charles  Warren  Pickell 

Detroit,  Michigran 
1917 


THIS  BOOK  BELONGS  TO  THE  COMPANY 
AND  IS  LOANED  TO  THE  FIELD  REPRESENTATIVE 


12532a 


Copyright  1917 

by 

Massachusetts  Mutual  Life  Insurance  Company 

Springfield,  Mass. 


m 
877 

P58e 


PREFACE 

In  the  preparation  ot  the  following  pages,  the  clearly- 
expressed  wishes  of  the  Company  to  make  the  text 
brief  and  to  the  point  have  been  carefully  respected. 

A  vast  amount  of  material  that  some  might  regard  as 
both  cognate  and  essential  has  been  excluded. 

No  attempt  has  been  made  to  duplicate  what  the 
solicitor  could  find  plainly  stated  in  our  circulars, 
policies,  and  Book  of  Instructions  to  agents,  but  the 
aim  has  been  to  reinforce  such  information  with  other 
kindred  matter  pertinent  to  our  work. 

Emphasis  has  been  placed  upon  our  policies,  values, 
options,  and  other  salient  features  sometimes  over- 
looked or  minimized, — and  how  to  sell  them.  Space 
has  been  devoted  to  the  agent's  work,  use  of  his  time, 
how  to  express  the  dignity  of  his  profession,  how  to 
conduct  himself,  etc. 

The  great  subject  of  salesmanship  has  only  been 
outlined — the  foundation,  growth,  and  history  of  life 
insurance  merely  mentioned — only  a  digest  of  the 
Massachusetts  laws  is  incorporated. 

The  Company's  purpose  to  provide  a  manual  that 
would  be  especially  adapted  for  the  training  of  new 
solicitors,  thereby  saving  the  General  Agents'  time  and 
labor, — and  at  the  same  time  offer  certain  well-tried 
plans  to  the  more  experienced, — has  been  the  author's 
guiding  star. 

The  book  is  not  exhaustive.  It  is  not  an  encyclo- 
pedia of  the  life  insurance  business  or  an  unabridged 
treatise   on   the   fine   art   of   salesmanship.     To    the 


") 


4  PREFACE 

untrained  field  man,  it  is  believed,  it  will  prove  an 
instructive  and  creditable  monitor — to  the  more 
experienced,  suggestions  herein  offered  may  lead  to  the 
designing  of  other  plans  quite  as  profitable — new  to  us 
all. 

The  text  is  so  interwoven  and  correlative  that  some 
repetition  may  occur.  This  should  serve  to  add 
emphasis  and  so  aid  memory. 


LIFE 

Human  Life  is  a  profound  mystery — whence  it 
came — of  what  composed — whither  bound — its 
eternal  destiny,  are  far  beyond  the  realm  of  human 
genius  to  discover  or  explain.  Marvelous,  in- 
tangible, undefinable,  life  is  the  most  absorbing 
and  most  precious  possession  of  man. 

When  the  vital  spark  animates  this  inert  body  of 
clay,  it  becomes  a  feeling,  thinking,  acting  person- 
ality. A  wonderful  miracle  is  performed.  From 
such  a  union  immense  possibilities  are  born — enor- 
mous values  are  created,  transcending  every  other 
earthly  thing.  Life  is — life  becomes  vibrant,  pene- 
trating, peerless,  and,  we  believe,  immortal. 

From  prehistoric  tiwes  mankind  has  cherished 
life.  Every  means  known  to  primitive  as  well  as 
civilized  man  has  been  employed  to  preserve  and 
prolong  this  mystical  essence  we  call  "life. "  Science 
and  art  have  lent  their  aid,  but  to  no  avail.  We 
are  sojourners  only — incumbents  for  a  little  while. 

The  exact  time  when  our  earthly  pilgrimage  will 
end  and  the  vital  force  be  disconnected,  is  not 
known — and  will  never  be  known.  Death  is  cer- 
tain, but  indefinite — inevitable,  but  the  time  of  its 
arrival  unknown. 

To  minimize  the  loss  by  death — to  replenish 
the  waste  by  our  taking  off — to  repair  the  damage 
to  home  and  loved  ones — to  establish  order  and 
perpetuate  values — to  maintain  the  purity  and 
adequacy  of  society — to  safeguard  the  state  and 
through  the  state  the  nation, — has  been  the  aim  of 
the  human  race  for  many  centuries. 

A  device  has  been  discovered — it  is  Life  Insurance 
— which  is  born  of  life's  uncertainty  and  calculated 
to  supply  every  human  need.  We  believe  it  to  be 
one  of  the  greatest  blessings  ever  given  to  the 
children  of  men. 


CHAPTER  I 


BRIEF   HISTORY   OF  LIFE   INSURANCE 

Life  insurance  is  no  new  expedient.  The  cardinal 
principles  upon  which  it  operates  have  been  known 
and  employed  for  centuries.  Crude  and  unscientific 
at  first,  protection  in  some  form  has  been  furnished 
dependents  against  the  untimely  death  of  the  bread- 
winner, for  more  than  2000  years.  Individual  in- 
demnity at  the  expense  of  the  many — the  uncertainty 
of  human  life — the  love  of  wife  and  children — are  the 
bases  upon  which  the  business  has  been  reared. 

Since  the  whole  community  would  suffer  if  one 
individual  did,  society  should  be  safeguarded  against 
penury  and  want.  Life  insurance  is  the  only  institution 
calculated  to  equalize  social  disturbance  and  financial 
disorder  caused  by  death — it  capitalizes  the  value  of 
a  human  life  and  restores  its  equivalent  (as  nearly  as 
money  can)  to  the  commonwealth. 

Mankind  is  exposed  to  the  inroads  of  death.  In 
most  cases,  life's  cherished  plans  are  unfinished — 
adequate  provision  has  not  been  securely  made  for 
home  and  dear  ones — business  affairs  incomplete  and 
contingent  are  in  a  tangle — when  the  summons  comes. 
It  is  the  province  of  life  insurance  to  protect  each 
individual — and  therefore  the  community — against 
such  a  day  of  need. 

About  three  hundred  years  before  Christ,  there  were 
organized  in  Greece  societies  for  the  purpose  of  provid- 
ing funds  to  care  for  their  members  when  sick  and 
bury  them  when  dead.  These  guilds  or  trade  unions 
were  called  " Eranoi"  or  "Thiasoi."     These  societies 


8       MASSACHUSETTS  MUTUAL  TEXTBOOK 

became  very  popular  and  furnished  the  first  authentic 
instance  of  organized  effort  to  insure  against  loss  of 
life. 

The  idea  reached  Rome  and  Orders  known  as 
"Collegia"  were  formed  to  confer  similar  benefits  upon 
their  certificate  holders.  The  blessings  of  such  protec- 
tion, meager  and  crude  as  the  system  was,  spread 
rapidly  over  Europe,  until  during  the  Middle  Ages, 
when  civilization  seemed  to  wane,  Trade  Guilds  had  an 
enormous  growth.  They  were  developed  into  a  more 
satisfactory  form  in  England  and  Teutonic  countries, 
where  they  reached  their  highest  development. 

Out  of  these  orders,  calculated  to  furnish  small 
payments  to  the  beneficiaries  of  workers  in  arts  and 
crafts,  grew  the  "Friendly  Societies"  of  Great  Britain, 
which  accepted  members  outside  of  the  trades  and 
many  of  which  were  more  generous  than  the  guilds 
in  the  amounts  paid. 

In  1699  there  was  formed  the  Society  of  Assurance 
for  Widows  and  Orphans,  and  in  1706  The  Amicable 
Society  for  a  Perpetual  Assurance  Office — both  in 
Great  Britain.  These  two  societies  constituted  the 
first  attempt  at  life  insurance  as  we  know  it.  Between 
1699  and  1720  many  life  insurance  schemes  were 
exploited  in  England  alone,  but  all  were  defective. 

"//  may  be  taken  as  established  that  no  plan  of  life 
insurance  as  we  now  understand  it,  had  been  contem- 
plated by  any  Company  or  Society,  or  had  been  considered 
by  any  legislature  in  Europe,  prior  to  the  year  1760." 

(HOLCOMBE.) 

The  modern  system  of  scientific,  legal-reserve  life 
insurance  began  in  1762  with  the  Equitable  Assurance 
Society  of  London.  This  company  issued  policies  for 
fixed  amounts  and  graded  the  premiums  according  to 
age. 


BRIEF  HISTORY  OF   LIFE   INSURANCE  9 

It  is  a  fine  tribute  to  our  system  of  insurance  that 
this  splendid  old  corporation  is  still  prosperous  and 
insuring  lives  as  it  has  done  for  over  150  years.  It 
has  well  been  called  the  "Parent"  of  "Old  Line,"  level 
premium  life  insurance. 

In  the  United  States  of  America,  the  Presbyterian 
Ministers  Fund  of  Philadelphia  takes  priority  over  all 
the  rest,  having  been  chartered  in  1759.  Early  in  its 
history  it  simply  dispensed  funds,  as  subscribed  by 
ministers  and  others,  for  relief  of  poor  and  distressed 
widows  and  children  of  Presbyterian  Ministers. 
Needy  ministers  were  also  assisted.  Later  its  busi- 
ness was  established  more  solidly  on  the  legal  re- 
serve basis.  This  company  is  still  writing  insurance 
and  is  one  of  the  soundest  and  best  conducted  com- 
panies in  America.  To-day  a  large  number  of  reliable 
"Old  Line"  companies  are  engaged  in  the  greatest 
business  the  world  has  ever  seen.  During  the  last 
sixty  years  there  has  been  a  process  of  reforming 
abuses, — eliminating  unsound  companies, — refining 
methods  and  plans, — until  to-day  legal  reserve 
companies  are  reliably  and  economically  conducted — 
supervised  by  wise  legislation  and  firmly  established 
upon  a  correct  mathematical  and  scientific  basis. 
Life  insurance  is  destined  to  expand  until  its  shield  of 
protection  shall  cover  the  globe  and  its  great  blessing 
be  felt  by  every  one. 


CHAPTER  II 


MASSACHUSETTS  MUTUAL  LIFE   INSURANCE 
COMPANY 

INTRODUCTORY 

♦'Massachusetts"— the  "Old  Bay  State"— first 
American  home  of  our  Pilgrim  fathers — and  one  of  the 
thirteen  original  states — has  made  splendid  history  for 
nearly  three  hundred  years. 

It  has  been  foremost  in  encouraging  and  fostering  all 
institutions  calculated  to  protect  its  citizens  and  con- 
serve their  interests.  The  very  name  "Massachusetts" 
has  become  a  synonym  for  security,  dignity,  honesty, 
and  permanency,  wherever  known. 

The  word  "Mutual"  in  the  Company's  name  means 
co-operation,  correlation — the  interdependence  of  rights, 
privileges,  functions,  etc.  It  means  that  each  member 
is  working  for  all  the  rest,  and  all  the  rest  are  working 
for  each  individual.  It  means  community  of  interests 
— and  reciprocal  relations. 

The  Massachusetts  Mutual  Life  Insurance  Com- 
pany is  not  a  commercial  institution,  organized  to 
make  money.  It  has  no  stockholders  to  receive 
dividends  or  control  its  affairs.  All  of  its  business 
operations  are  for  the  benefit  of  all  of  its  policyholders 
and  their  beneficiaries. 

Since  it  was  organized  its  pre-eminent  aim  has  been 
fivefold : 

To  build  a  business  that  will  never  know  com- 
pletion but  will  move  forward  continually  to  meet 
varying  conditions. 


THE  COMPANY  11 

To  develop  all  justifiable  forms  of  life  insurance 
and  uniform  service,  to  a  notable  degree. 

To  create  a  personality  that  will  be  known  and 
admired  for  its  strength  and  friendliness. 

To  arrange  and  co-ordinate  all  activities  to  the 
end  of  winning  confidence  by  meriting  it. 

To  strive  always  to  win  and  keep  the  satisfaction 
of  every  policyholder. 

To  achieve  these  ends  oflficials  and  field  men  have 
labored  untiringly.  They  have  extended  to  all  those 
connected  with  the  Company  in  any  way  the  best 
possible  co-operative  service.  Back  of  this  service 
there  have  been  honesty  of  purpose,  intelligence  in 
action,  and  enthusiasm  tempered  with  reason. 

The  Massachusetts  Mutual  has  existed  and  prospered 
by  virtue  of  this  unsurpassed  co-operation  in  all  its 
departments  of  office  and  field. 

In  every  community  any  institution  is  rated  by  its 
representative.  Each  officer  or  solicitor  who  comes 
in  contact  with  social  or  business  life  becomes  the 
exponent  of  the  corporation  he  represents, — as  far  as 
the  average  patron  is  concerned,  he  is  the  corporation. 
Upon  every  official  and  field  man  of  the  Massachusetts 
Mutual  rests  a  grave  and  far-reaching  responsibility,  to 
be  discharged  cheerfully,  whole-heartedly.  Since  our 
great  Company  was  granted  its  charter,  its  fair 
name  has  been  preserved  unsullied  by  any  stain 
of  wrong  or  evil  rumor.  It  is  not  too  much  to  say 
that,  with  advancing  years  bringing  improved  methods, 
increased  efficiency  and  loftier  ideals,  its  fair  name 
shall  be  preserved  inviolate — it  shall  be  characterized 
in  the  future  years  as  it  has  been  in  the  past — a 
policyholders'  company,  honestly  and  capably  managed 
in  the  interests  of  its  many  thousands  of  members,  that 


12  MASSACHUSETTS   MUTUAL  TEXTBOOK 

each  may  receive  the  best  of  life  insurance  at  the  lowest 
possible  cost. 

HISTORICAL 

The  Massachusetts  Mutual  Life  Insurance  Company 
was  chartered  by  the  Commonwealth  of  Massachusetts 
on  May  15,  1851.  Its  charter  by  the  state  law  required 
$100,000  capital  stock  before  it  could  start  business. 
This  was  raised,  and  dividends  thereon  limited  to 
seven  per  cent  to  the  stockholders.  This  stock  was 
retired  in  1867,  from  which  time  the  Company  has 
been  purely  mutual.  The  threefold  purpose  of  its 
founders  was  that: 

All  the  Company's  funds  were  trust  funds  and  were 
to  be  scrupulously  safeguarded. 

In   all   its   business   transactions    economy   of   the 
strictest  kind  should  obtain. 

Its  policies  should  be  consistently  generous  and  fit 
the  needs  of  its  members  and  their  beneficiaries. 

The  Company  commenced  business  in  a  single  room 
on  the  second  floor  of  Foot's  Block  at  the  southwest 
corner  of  Main  and  State  Streets,  Springfield,  Massa- 
chusetts. This  building  was  the  Company's  home 
until  1868.  During  that  year  the  Company  erected 
a  four-story  building  of  brown-stone  at  413  Main 
Street,  and  moved  into  it  the  same  year,  occupying 
the  second  and  third  floors.  In  1908,  having  outgrown 
this  building,  a  substantial  and  dignified  structure  of 
eight  stories  was  erected  on  the  same  corner  where  the 
Company  began  business  fifty-seven  years  before. 
This  building  is  solid  and  enduring.  The  interior  is 
conveniently  arranged  for  business,  and  is  neither 
scantily  nor  lavishly  equipped.  The  building  will  be 
ample  for  the  Company's  business  for  many  years. 

The  first  policy  was  issued  August  1,  1851. 


THE   COMPANY  13 

The  following  epitomized  review  of  the  Company's 
history  up  to  1917  may  be  of  interest: 

1851,  May  15     Company  is  incorporated  under  the 

laws  of  the  Commonwealth  of  Mas- 
sachusetts.     Caleb   Rice,    President; 

E.  D.   Beach,  Vice  President;    F.  B. 

Bacon,  Secretary. 

First  policy  issued. 

First     Massachusetts     non-forfeiture 

law  goes  into  effect. 

First  dividend  of  $53,617  is  paid  to 

policyholders. 

Assets  reach  $1,000,000. 

Second  dividend  of  $258,450  is  paid 

to  policyholders. 

Capital  stock,  $100,000,  is  retired. 

Company  occupies  its  own  new  Home 

Office  building. 

Begins  paying  annual   dividends   to 

policyholders. 

James  Weir  Mason  is  elected  Actuary. 

Secretary   Bacon   dies;     C.    McLean 

Knox  is  chosen  successor. 

Actuary  Mason  resigns  and  Oscar  B. 

Ireland  is  elected  successor. 

Home  Office  is  burned  out. 

Caleb  Rice,  the  first  President,  dies. 

Ephraim  W.   Bond  is  elected  Presi- 
dent;   Charles  McLean  Knox,   Vice 

President;  Avery  J.  Smith,  Secretary. 
1881,  Jan.      1     Massachusetts    Act    of    1880    takes 

effect,  cash  and  paid-up  values  being 

thereby  fixed  by  law. 

1886  President  Bond  resigns  and  Martin  V. 
B.  Edgerly  becomes  President. 

1887  New  business  reaches  $10,000,000. 
1889                     Assets  reach  $10,000,000. 

1 89 1  Surplus  reaches  $  1 , 000, 000. 


1861, 

Aug. 
Apr. 

1 
10 

Aug. 

1 

1865 
1866, 

Aug. 

1 

1867, 
1868 

Sept. 

9 

1869 
1870 

1872 

- 

1873, 

Feb. 
Mar. 
Mar. 

5 
1 
4 

14  MASSACHUSETTS   MUTUAL   TEXTBOOK 

1892  New  business  reaches  $20,000,000. 

1895  President  Edgerly  dies  and  John  A. 
Hall  is  elected  President;  Henry  S. 
Lee,  Vice  President;  Henry  M. 
Phillips,  Secretary. 

1896  Death  Claims  reach  $1,000,000. 
1898                     Total  income  reaches  $5,000,000. 
1901,  Jan.      1     Massachusetts  Act  of  1900  goes  into 

effect,    and    Company    goes    on    to 
American    33^    per    cent    basis    for 
premiums  and  values. 
1907,  Oct.      1     Company  adopts  American  3  per  cent 
basis  for  premiums  and  values. 

1908  Assets  reach  $50,000,000. 
Sept.    3     Death  of  President  Hall. 

Oct.      9     Company    moves    into    new    Home 
Office  building. 

Oct,    28     William  W.  McClench  is  chosen  Pres- 
ident;    William    H.    Sargeant,    Vice 
President;    Wheeler  H.  Hall,  Secre- 
tary. 
Total  income  reaches  $10,000,000. 

1909  New  Business  reaches  $30,000,000, 
paid-for  basis. 

1911  Assets  reach  $60,000,000. 

Sixtieth  Anniversary. 

1915  New  business  reaches  $45,000,000 
delivered. 

1916  New  business  paid  for,  $57,125,676. 
Admitted  assets,  $93,240,377. 
Insurance  in  force,  $410,166,020. 

Since  1886  each  year's  apportionment  of  surplus  for 
dividend  payments  has  exceeded  that  of  the  year  pre- 
vious. 

CHARACTER 

By  "character"  is  meant  the  essential  qualities  or 
principles  exemplified.  The  Massachusetts  Mutual 
has  always  possessed  those  intrinsic  features  which  one 


THE   COMPANY  IS 

expects  to  find  in  a  corporation  entrusted  with  fiduciary 
funds.  Promptness,  courtesy,  honesty,  economy,  and 
other  commendable  characteristics,  have  marked  its 
career. 

It  has  always  been  a  full  legal  reserve  or  so-called 
"Old  Line"  company.  Simply  stated,  this  means 
that  it  must  at  all  times  have  enough  funds  available  to 
pay  all  claims  as  they  become  due. 

It  has  never  issued  any  other  kinds  of  insurance  than 
Life  and  Endowment.  All  its  assets  and  surplus 
belong  to  all  its  policyholders.  Its  business  record  is 
unimpeachable,  and  its  standing  throughout  the 
country  the  finest  and  highest. 

Among  the  other  excellent  qualities  the  Massa- 
chusetts Mutual  Life  Insurance  Company  possesses,  but 
which  we  shall  not  take  time  to  elaborate,  the  follow^- 
ing  might  be  mentioned: 

It  has  the  wisdom  of  age  and  the  vigor  of  youth. 

Has  a  nation-wide  reputation  for  honoring  its 
obligations. 

Entirely  free  from  objectionable  features. 

Its  general  agents  and  solicitors  are  men  of  good 
moral  character  and  possessed  of  a  high  degree  of 
intelligence. 

Policyholders  are  very  carefully  selected. 

Not  a  dollar  of  foreign  securities  among  its  assets. 

No  business  solicited  outside  United  States. 

Benefits  and  privileges  contained  in  recent  policies 


16  MASSACHUSETTS   MUTUAL   TEXTBOOK 

have  been  conferred  upon  old  policyholders  so  far 
as  possible. 

Every  dollar  of  its  assets  is  of  the  very  best  character 
and  highest  quality. 

OFFICIALS 

The  control  of  the  Company's  affairs  is  vested  in 
a  Board  of  Directors — twenty  in  number — term  of 
office  four  years.  Directors  are  chosen  by  the  policy- 
holders at  the  Annual  Meeting  of  the  Company,  held 
the  third  Wednesday  in  January  of  each  year.  No 
policyholder  can  vote  by  proxy  more  than  twenty 
votes.  No  officer  shall  himself  or  by  another,  ask  for, 
receive,  procure  to  be  obtained,  or  use  a  proxy  to  vote. 

The  Directors  and  Officials  in  charge  of  the  Com- 
pany's affairs  have  been  men  of  great  executive  ability 
and  sterling  integrity — actuated  by  the  worthiest 
motives  and  determined  to  conserve  and  preserve  the 
vested  interests  of  the  members.  During  its  entire 
history  not  one  word  of  censorious  criticism  has  ever 
been  offered  by  Insurance  Commissioners  or  others  in 
authority  for  any  official  act. 

The  Directors  choose  the  following  officers:  Presi- 
dent, Vice  Presidents,  Secretary,  Assistant  Secretaries, 
Actuary,  Assistant  Actuary,  Medical  Directors  and 
Assistant  Medical  Director,  Superintendent  of  Agents, 
Counsel,  Assistant  Counsel,  Superintendent  of  Loans, 
and  such  other  officers  and  assistants  as  are  needed. 

DUTIES  OF  OFFICERS 

President.  The  President  is  the  chief  executive  of 
the  Company.  He  has  authority  over  all  the  depart- 
ments of  work,  in  Home  Office  and  Field.  He  is  the 
responsible  head  of  the  Company  in  the  eyes  of  the 
law.     To  him  more  than  to  any  other  official,  policy- 


THE  COMPANY  '  17 

holders  and  their  beneficiaries  look  for  the  safeguarding 
of  their  funds  and  the  protection  of  their  homes  and 
other  sacred  interests.  He  presides  at  all  meetings  of 
the  Board  of  Directors.  He  is  ex  officio  a  member  of 
the  Finance  Committee  and  of  all  other  Committees. 

Upon  him  more  than  upon  any  one  else  rests  the 
great  responsibility  of  watching  the  Company's  assets 
— investing  funds  constantly  coming  in  and  re-invest- 
ing the  proceeds  of  maturing  securities.  As  the  chief 
executive  of  a  great  institution,  his  varied  duties 
impose  a  sacred  trust,  which  must  be  intelligently, 
honestly,  and  faithfully  administered. 

The  Vice  Presidents  are  his  assistants.  In  case  of 
his  death,  the  First  Vice  President  would  act  in  his 
stead,  until  the  Board  of  Directors  choose  his  suc- 
cessor. 

Secretary.  The  Secretary  is  the  Company's  official 
correspondent  and  recorder.  He  corresponds  with 
General  Agents,  cares  for  the  many  wants  of  policy- 
holders, and  discharges  many  other  duties  incident  to 
his  office. 

Actuary.  The  Actuary  has  charge  of  the  mathe- 
matical branch  of  the  business.  He  figures  premium 
rates,  dividends,  reserves,  installments,  etc.  He  must 
be  skilled  in  calculation  of  interest,  averages,  proba- 
bilities, etc.,  in  order  to  meet  the  special  demands  of 
a  Company  having  so  many  and  such  varied  re- 
quirements. 

Medical  Director.  The  Medical  Director  is  the 
official  who  examines  all  applications,  reports,  and 
records,  in  order  to  determine  the  desirability  of  the 
risks  submitted  by  the  field  men.  Any  physical, 
mental,  or  moral  impairment  must  be  detected  if 
unnecessary  losses  are  to  be  prevented.     To  this  end 


18  MASSACHUSETTS  MUTUAL  TEXTBOOK 

great  care  is  exercised.  The  Director  is  in  constant 
touch  with  the  hundreds  of  examiners  employed,  and 
is  advising  them  how  to  do  their  work,  so  as  to  meet 
the  Company's  wishes. 

Counsel.  The  Company's  Attorney  at  Law  has  the 
legality  of  all  matters  connected  with  the  Company's 
operations  to  determine.  He  must  know  the  insurance 
law  in  every  state  where  the  Company  does  business. 
He  must  examine  abstracts  of  titles  where  real  estate 
loans  are  made,  must  frame  all  unusual  benefits  or 
changes  in  policy  contracts  in  keeping  with  state 
regulations,  must  defend  the  Company  when  neces- 
sary, or  bring  suit  to  secure  its  rights,  if  required,  must 
devise  agent's  contracts  in  equity,  etc.  His  office 
and  work  are  most  important,  requiring  hard  study 
and  intelligent  service. 

Superintendent  of  Agents.  The  Superintendent  of 
Agents  is  in  charge  of  the  Company's  Field  Force. 
Among  the  duties  imposed  upon  this  official,  the 
following  are  most  important: 

General  supervision  of  all  agencies. 

Assisting  the  General  Agent  to  organize  his  field. 

Opening  up  new  fields. 

Installing  new  agents. 

Instructing,  assisting,  directing,  inspiring  all  field 
workers. 

The  volume  of  new  business  in  a  large  measure 
depends  upon  the  way  this  official  performs  his  work. 

Superintendent  of  Loans.  The  Superintendent  of 
lyoans  has  the  general  oversight  of  the  securing  of 
applications  for  mortgage   loans.     Through  frequent 


THE   COMPANY  19 

visits  to  the  cities  where  the  Company  places  loans,  he 
becomes  familiar  with  local  conditions  and  with  the 
properties  upon  which  the  Company  has  made  loans. 
Under  his  direction,  and  subject  to  the  requirements 
of  the  legal  department  of  the  Company,  all  papers  in 
connection  with  such  loans  are  prepared  and  abstracts 
of  title  are  examined  at  the  Home  OflEice. 

Committees.  The  Directors  also  choose  from  their 
number  a  Finance  Committee,  which  looks  after  the 
investment  of  the  Company's  funds;  a  Loss  Com- 
mittee, which  passes  on  death  claims;  and  an  Agency 
Committee,  which  supervises  agency  matters. 

INVESTMENTS 

The  Massachusetts  Mutual  Life  Insurance  Company 
invests  its  assets  in  three  ways:  first,  in  bonds  of 
the  United  States  Government  or  of  any  state,  rail- 
roads, municipalities,  and  counties ;  second,  in  mortgage 
loans  on  real  estate;  third,  loans  to  policyholders  on 
policies. 

Bonds.  With  reference  to  the  investment  in  bonds, 
our  Finance  Committee  must  comply  with  the 
statutes  of  Massachusetts,  as  to  the  character  of  the 
bonds  selected.  A  careful  examination  of  the  list  of 
bonds  owned  by  the  Company  and  published  in  its 
annual  report  attests  the  painstaking  and  wise  judg- 
ment used  by  its  officials  to  protect  the  policyholders' 
money. 

Mortgage  Loans.  In  loaning  money  on  real  estate 
for  more  than  sixty-five  years,  the  Company  has  found 
it  desirable  to  adopt  certain  methods  and  precautions 
that  could  in  nowise  be  objectionable  to  the  borrower 
or  entail  a  loss  to  the  Company.  It  is  imperative 
when  investing  trust  funds  that  good  security  should 
be  selected.  The  Company  has  been  exceedingly 
careful  in  choosing  desirable  fields  in  which  to  loan, 


20  MASSACHUSETTS   MUTUAL   TEXTBOOK 

and  in  later  years  has  confined  its  loans  on  real  estate 
to  a  number  of  the  larger  cities  of  the  country.  In 
these  cities  the  centrally  located  business  property 
gives  the  Company  the  best  proportion  of  values,  and 
is  less  liable  to  depreciation.  Before  a  mortgage  loan 
can  be  made  by  our  Company,  each  member  of  the 
Finance  Committee  authorizing  such  a  loan  is  required 
by  the  State  of  Massachusetts  to  certify  as  to  the  fair 
market  value  of  the  security,  and  such  certificates 
must  be  recorded  on  the  books  of  the  Company.  There 
are  certain  states  in  which  the  Company  does  not 
loan,  because  of  legal  restrictions  and  other  objections. 

The  Company  should  be  very  conservative,  and 
exercise  great  caution,  because  it  is  loaning  fiduciary 
funds.  So,  in  considering  loans  on  real  estate  the 
Company  must  have  the  benefit  of  all  doubts.  All 
property  upon  which  the  Company  has  mortgage 
loans  is  frequently  examined  as  to  its  physical  condi- 
tion. All  buildings  on  such  property  must  be  covered 
by  fire  insurance,  and  the  policies  assigned  and  delivered 
to  the  Company.  The  result  of  our  Company's  opera- 
tions during  its  history  has  been  such  that  the  funds 
entrusted  to  it  have  yielded  a  good  income  on  the 
investment. 

Policy  Loans.  Loans  upon  policies  are  made  to  pay 
premiums  thereon  when  the  insured  finds  it  difficult  to 
meet  same,  provided  such  policies  have  sufficient  value. 
These  are  called  "premium  loans."  Cash  loans  are 
also  made  upon  the  policies  as  collateral,  and  the  proper 
assignment  of  the  policies  to  the  Company.  The 
Massachusetts  Mutual  has  never  encouraged  loans 
upon  policies  by  reducing  below  six  per  cent  the  rate 
of  interest  charged.  Some  years  ago  most  companies 
charged  a  rate  of  interest  lower  than  six  per  cent, 
and,  in  fact,  the  Massachusetts  Mutual  was  one  of 
a  very  small  group  of  companies  charging  six  per  cent. 
The  wisdom  of  this  position  has  been  justified  in  that 


THE  COMPANY  21 

now  practically  every  company  charges  six  per  cent 
for  policy  loans. 

AGENCIES 

The  Company  has  always  confined  its  operations  to 
the  healthier  sections  of  the  United  States.  No 
business  has  ever  been  sought  in  any  foreign  country. 

In  the  establishment  of  its  agencies,  in  the  main, 
large  commercial  centers  and  well  developed  agricul- 
tural and  industrial  communities  have  been  selected, 
and  capable  men  placed  in  charge.  Increasing  agency 
and  individual  efficiency  is  the  constant  aim  of  the 
Agency  Department. 

MEDICAL  EXAMINERS 

The  examination  of  the  applicant  is  a  most  impor- 
tant factor  in  our  business.  Examiners  are  appointed 
by  the  Home  Office,  although  suggestions  from  the  field 
force  are  heartily  welcomed.  The  Company  employs 
only  those  physicians  whose  education  is  sound  and 
whose  equipment  is  ample  for  the  requirements  ex- 
acted, in  order  to  secure  first-class  risks.  The  Com- 
pany does  not  issue  sub-standard  policies. 


CHAPTER  III 


DEFINITIONS 

Life  Insurance  is  an  indemnity  for  loss  of  the  product 
of  life.  Or,  to  simplify,  purely  mutual  life  insurance 
consists  in  binding  together  by  a  plain  agreement 
(called  a  policy)  a  large  number  of  persons  who 
promise  to  stand  by  one  another,  so  truly  and  well, 
that,  if  one  suffers  a  loss,  all  the  rest  join 'in  making  it 
good.  In  other  words,  if  one  should  die,  all  the  living 
members  unite  to  care  for  his  dependents. 

All  forms  of  life  insurance  rest  upon  two  scientific 
principles — the  law  oj  average,  and  the  protection  of 
the  individual  at  the  expense  of  the  many. 

Again :  Life  Insurance  is  a  great  financial  enterprise 
carried  on  by  life  insurance  companies — a  business, 
far-reaching,  enormous  in  volume,  growing  at  a 
tremendous  pace.  When  correctly  organized  and 
intelligently  and  honestly  managed  such  companies 
become,  without  exception,  the  safest  of  all  financial 
concerns.  The  Massachusetts  Mutual  Life  Insurance 
Company  is  an  experienced,  sound,  highly  developed, 
and  very  efficient  corporation,  chartered  by  the  Com- 
monwealth of  Massachusetts  to  provide  the  protec- 
tion furnished  by  life  insurance. 

It  does  away  with  chance. 

It  warrants  the  education  and  c'are  of  the  children. 

It  guarantees  the  things  desired. 

It  assures  the  comfort  of  wife  and  self  in  old  age. 


DEFINITIONS  23 

It  makes   certain   the   continuance   of  commercial 

enterprises. 

The  following  definitions  arranged  alphabetically 
will  be  found  useful : 

Advance  Premium  Receipt.  When  an  applicant 
for  insurance  pays  the  first  premium  to  the  agent  at 
the  time  of  making  application,  there  is  provided 
a  binding  receipt  which  the  Company  requires  to  be 
carefully  executed  and  handed  to  the  applicant  for 
money  so  advanced.  By  virtue  of  this  binding 
receipt,  if  the  application  is  approved  at  the  Home 
Office,  and  the  policy  is  issued,  protection  is  afforded 
the  applicant  from  the  date  of  the  medical  examination. 
These  binding  receipts  are  carefully  numbered,  must 
be  accounted  for,  and  are  a  valuable  aid  in  securing 
cash  for  the  first  premium  at  the  time  of  writing  the 
application. 

Amount  at  Risk.  The  amount  the  Company  has 
at  risk  on  an  individual  life  at  any  time  is  the  difference 
between  the  face  of  the  policy  and  the  reserve. 

Assets.  All  the  property  the  Company  owns  of 
every  kind  constitutes  the  assets. 

Assignee.     The  person  to  whom  a  policy  is  assigned 

is  called  the  assignee. 

Assignment.  When  a  policyholder  transfers  his 
interest  in  his  policy  to  another  party,  the  document 
by  which  the  transfer  is  made  is  called  an  assignment. 

Beneficiary.  The  beneficiary  is  the  person,  institu- 
tion, or  company,  to  whom  the  policy  is  made  payable. 

Cash  Surrender  Value.  After  a  stated  number  of 
premiums  have  been  paid  the  policy  owner  who  wishes 


24      MASSACHUSETTS  MUTUAL  TEXTBOOK 

to  withdraw  from  the  Company  may  give  up  his  policy 
and  receive  therefor  a  definite  amount  of  cash.  This 
is  called  the  cash  surrender  value.  All  companies 
operating  under  the  Massachusetts  laws  and  chartered 
by  the  State  of  Massachusetts  have  minimum  values 
fixed  by  law,  and  the  values  must  be  incorporated  in 
all  policies  issued.  After  the  ninth  policy  year  the 
cash  surrender  value  in  all  Massachusetts  Mutual 
policies  is  the  full  legal  reserve.  Cash  values  continue 
during  the  life  of  the  policy.  Withdrawals  are  re- 
garded as  detrimental  to  the  interests  of  the  remain- 
ing policyholders.  It  is  to  compensate  for  this  loss 
that  a  surrender  charge  is  made  during  the  early  years 
of  a  policy. 

Changes.  Many  changes  are  being  made  in  policy 
contracts,  payment  of  premiums,  beneficiaries,  etc. 
Requests  for  such  changes  must  be  carefully  made  on 
blanks  provided  by  the  Company,  with  the  utmost 
care  exercised  in  following  the  instructions  of  the 
Home  Office  in  every  detail.  Much  depends  upon 
accuracy  in  complying  with  legal  and  official  require- 
ments. 

Discounting  Premiums.  If  the  insured  should 
desire  at  any  time  to  pay  premiums  in  advance,  the 
Company  will  discount  such  premiums  at  a  fixed  rate 
of  simple  interest,  and  will  provide  the  insured  with 
a  statement  to  the  effect  that  should  death  occur  the 
then  present  worth  of  any  premiums  not  yet  due  by 
the  terms  of  the  policy  will  be  paid  in  addition  to  the 
face  of  the  policy. 

Dividends.  The  share  of  surplus  annually  paid  to 
a  policyholder  has  become  known  as  a  "dividend." 
This  payment  is,  however,  not  a  dividend  in  the  com- 
mercial sense  of  the  word,  but  simply  a  refund  of  that 
portion  of  the  premium  paid  which  has  not  been  re- 
quired to  carry  the  policy  throughout  the  foregoing 
year  and  establish  the  necessary  reserve.     These  re- 


DEFINITIONS  25 

fHHds  may  be  paid  in  cash,  or  applied  in  reduction  of 
premiums,  or  left  to  accumulate  at  compound  interest, 
or  used  to  purchase  participating  paid-up  additions  to 
the  sum  insured.  The  amount  of  the  refund,  or  divi- 
dend, will  depend  upon  the  age  of  the  policyholder, 
the  kind  of  policy,  and  the  number  of  years  the  policy 
has  been  in  force. 

Endowment  Policy.  An  Endowment  policy  is  one 
that  is  paid  to  the  insured  if  living  at  the  expiration 
of  a.  fixed  number  of  years,  or  to  the  beneficiary  in  case 
of  the  insured's  prior  death. 

Errors.  So  long  as  the  human  mind  has  to  deal 
with  human  affairs,  errors  will  creep  into  policies,  and 
sometimes  have  become  very  embarrassing.  It  is  ex- 
pected of  every  agent  or  clerk  who  discovers  an  error 
in  any  policy  issued  by  the  Company,  to  report  same 
at.  once,  and  return  the  policy  for  correction.'  Not- 
withstanding the  great  pains  taken  by  the  Company 
to  avoid  these  errors,  they  will  occasionally  happen, 
and  in  this  matter  the  Company  appreciates  the  hearty 
co-operation  of  all  its  field  force. 

Expectancy.  The  average  after-lifetime  of  a 
number  of  persons  of  a  specified  age  according  to 
a  given  table  of  Mortality  is  called  their  expectancy — 
or  expectation  of  life. 

Extended  Insurance.  Extended  insurance  is  paid- 
up  term  insurance  continuing  for  as  many  years, 
months,  and  days  as  the  cash  value  at  the  time 
extended  insurance  is  applied  for  will  purchase.  If 
there  is  no  indebtedness  the  amount  of  insurance  will 
be  the  same  as  under  the  original  policy. 

Gross  Premium.  The  gross  premium  is  the  sum 
of  the  net  premium  and  the  loading,  and  constitutes 
the  figure  given  in  your  rate  book,  for  each  kind  of 
policy  at  each  age. 


26      MASSACHUSETTS  MUTUAL  TEXTBOOK 

Incontestable.  A  policy  is  "incontestable"  when  it 
is  impossible  for  the  Company  to  dispute  the  payment 
thereof  for  any  cause  except  non-payment  of  premium 
or  for  violation  of  its  conditions  relating  to  military 
or  naval  service  in  time  of  war. 

Industrial  Insurance.  A  few  companies  insure 
children,  minors,  and  other  members  of  the  family, 
under  policies  of  very  small  amounts.  Premiums  are 
collected  weekly  from  house  to  house.  The  business 
has  grown  to  enormous  size. 

Inspection.  When  an  application  for  insurance  is 
made,  the  Company  makes  a  careful  investigation  as 
to  the  moral  and  financial  standing  of  the  applicant. 
This  plan  has  saved  the  Company  many  losses  and 
much  trouble. 

Insurable  Interest.  An  insurable  interest  is  many 
times  greatly  misunderstood.  The  law  says  any  one 
who  might  suffer  some  financial  loss  in  consequence  of 
the  death  of  the  insured  may  be  said  to  have  an 
insurable  interest  in  that  life.  The  law  is  not  designed 
to  restrict  the  business,  but  to  prevent  speculating  on 
human  lives. 

Joint  Life  Policy.  The  Company  issues  a  policy 
insuring  two,  sometimes  three  lives  under  one  contract, 
which  is  called  a  Joint  Life  policy.  Such  a  policy 
may  be  taken  by  a  husband  and  wife  if  there  are  de- 
pendent children.  In  this  case  the  Company  limits 
the  amount  of  insurance.  Partners  are  often  insured 
to  protect  their  business  interests.  A  corporation 
may  protect  its  investments  by  insuring  on  joint  poli- 
cies the  lives  of  its  officers  or  expert  employees. 

Lapse.  A  policy  is  said  to  lapse  when  the  insured 
fails  to  pay  the  premium  thereon  within  the  stipulated 
time.     Lapses  are  regarded  as  harmful  to  the  remain- 


DEFINITIONS  27 

ing  members  as  well  as  to  the  one  withdrawing.  It  is 
to  the  interest  of  all  to  continue  the  policy  on  the  books 
until  the  completion  of  the  contract. 

Legal  Reserve.  By  the  insurance  laws  of  the 
several  states  every  company  promising  a  death  or 
endowment  payment  of  an  absolute  amount,  and  col- 
lecting a  premium  that  is  not  subject  to  increase,  is 
compelled  to  maintain  the  reserve  required  by  the 
accepted  table  of  mortality  and  the  assumed  rate  of 
interest.     Hence  the  term,  legal  reserve. 

Level  Premium.  To  meet  the  objections  to  the 
natural  premium,  which  increases  every  year,  the  cost 
of  insurance  has  been  equalized  or  leveled — the  result 
is  the  level  premium.  The  natural  premium  is  smaller 
at  the  age  of  entry,  but  increases  each  year  thereafter; 
the  level  premium  is  somewhat  larger  at  entry,  but 
remains  fixed  through  life.  From  the  larger  premium 
a  certain  portion  called  the  reserve  is  accumulated  and 
grows  larger  from  year  to  year,  so  that  the  actual 
amount  the  Company  has  at  risk  grows  less  each  year. 
All  premiums  charged  by  the  Massachusetts  Mutual 
are  on  the  level  premium  basis. 

Liabilities.  All  that  a  company  owes  constitutes  its 
liability.  This  includes  the  reserve,  as  well  as  due  and 
unpaid  losses  or  claims,  and  all  incidental  obligations. 

Limited  Payment  Life  Policy.  This  is  one  upon 
which  the  premium  payments  are  to  be  completed  in 
a  limited  number  of  years,  and  the  sum  insured  is 
payable  at  the  death  of  the  insured. 

Loading.  Loading  is  the  amount  the  Company 
adds  to  the  net  premium  to  provide  for  expenses  and 
contingencies.  When  the  loading  has  been  added  to 
the  net  premium,  we  have  the  rate  (that  is,  gross 
premium)  as  given  in  our  rate  book. 


28  MASSACHUSETTS  MUTUAL   TEXTBOOK 

Loan  Value.  Most  companies  state  in  their  policies 
the  amount  of  money  to  be  loaned  at  stated  times, 
using  the  policies  as  collateral  security.  The  Massa- 
chusetts Mutual  has  loaned  upon  its  policies  for  a  great 
many  years,  but  never  at  less  than  six  per  cent, 
principally  because  the  Company  did  not  wish  to 
encourage  this  practice.  The  loan  value  on  our 
policies  is  the  same  as  the  cash  value. 

Maturity.  In  life  insurance  the  word  is  usually 
applied  to  the  termination  of  Endowment  policies,  by 
the  completion  of  the  periods  for  which  they  were 
written.  Sometimes  a  policy  is  said  to  mature  by 
death. 

Mortality.  The  premiums  charged  under  life 
insurance  policies  provide  for  a  certain  amount  of 
death  claims.  This  amount  is  known  as  the  expected 
mortality.  The  actual  claims  incurred  are  generally 
less  than  the  amount  expected,  owing  to  great  care 
exercised  in  selection  of  risks.  If  one  compares  the 
actual  with  the  expected  mortality,  taking  into 
account  the  policy  reserve,  he  will  determine  the 
saving  or  loss  from  deaths. 

Mortality  Table.  The  mortality  table  is  the 
instrument  by  means  of  which  are  measured  the 
probabilities  of  life  and  the  probabilities  of  death. 
By  means  of  such  tables  the  insurance  company  is 
able  to  determine  what  premiums  it  must  charge.  It 
gives  statistics  on  which  an  accurate  price  list  can  be 
based.  The  two  principal  tables  in  use  in  this  country 
are  the  American  Experience  Table  compiled  by 
Sheppard  Homans,  and  the  Actuaries^  or  Combined 
Experience  Table,  based  upon  the  experience  of 
seventeen  English  life  insurance  companies ;  according 
to  the  former  table  the  last  policyholder  will  die  between 
the  ages  of  95  and  96  and  according  to  the  latter  table 
between  the  ages  of  99  and  100.  Since  December  31, 
1900,    the   Massachusetts   Mutual  has  computed  its 


DEFINITIONS  29 

premium  rates  on  the  basis  of  the  American  Experience 
Table.  The  premium  rates  for  poHcies  issued  prior 
to  1901  were  based  upon  the  Actuaries'  or  Combined 
Experience  Table. 

Natural  Premium.  A  natural  premium  provides 
for  the  cost  of  insurance  for  one  year  only.  This 
premium  increases  as  the  age  of  the  insured  increases. 
The  natural  premium  is  identical  with  the  net  premium 
for  a  yearly  renewable  term  policy. 

Net  Premium.  A  net  premium  is  the  amount 
found  mathematically  necessary  to  enable  the  Company 
to  fulfill  its  contract.  It  is  the  rate  which  would  be 
proper  to  charge  if  the  business  could  be  conducted 
without  expense,  and  if  the  Company  could  be  protected 
against  a  loss  or  depreciation  in  the  value  of  its 
securities. 

Non-Forfeitable.  A  policy  which  guarantees  cash 
surrender  value,  paid-up  values,  or  extended  insurance 
values,  is  called  non-forfeitable  from  the  date  when 
such  values  become  available. 

"Old  Line"  Company.  Any  corporation  that 
writes  an  absolute  contract,  collects  a  fixed  level  premium, 
and  accumulates  a  legal  reserve  fixed  by  the  law  of  the 
state  under  which  it  is  incorporated,  is  frequently 
called  an  "OW  Line"  Company. 

Ordinary  Life  Policy.  An  Ordinary  Life  policy  is 
one  upon  which  the  insured  must  pay  the  premiums 
during  his  entire  life,  and  the  sum  insured  is  payable 
at  his  death. 

Paid-up  Additions.  Whenever  the  policyholder 
elects  to  use  his  dividend  to  buy  paid-up  insurance 
and  have  the  same  added  to  the  face  of  the  policy, 
such  paid-up  insurance  is  called  a  paid-up  addition. 
Whatever  dividend  he  may  have  at  a  certain  age  is 


30       MASSACHUSETTS  MUTUAL  TEXTBOOK 

used  as  a  single  premium  to  buy  insurance  at  that 
attained  age.  It  often  happens  that  as  the  insured 
grows  older  the  amount  of  reversionary  insurance 
purchased  by  a  dividend  grows  less,  owing  to  the 
increased  cost  of  insurance  at  his  advanced  age, — 
even  though  the  actual  cash  dividend  may  be  larger. 

Paid-up  Value.  The  amount  of  paid-up  insurance 
that  the  reserve,  or  a  stated  percentage  thereof,  used 
as  a  single  premium,  will  buy  is  called  the  paid-up 
value.  In  the  Massachusetts  Mutual  this  paid-up 
policy  participates  in  the  surplus,  that  is,  receives  an 
annual  dividend,  so  long  as  it  remains  in  force  on  the 
Company's  books.  This  paid-up  policy,  on  all  forms 
except  the  term  plan,  has  an  increasing  cash  surrender 
value  available  at  any  time. 

Policy.  The  written  contract  of  insurance  made 
with  the  Company  is  called  a  policy.  Various  forms 
of  policies  issued  by  the  Massachusetts  Mutual  will  be 
elaborated  further  on.  Every  policy  is  a  promise  to 
pay,  and  is  signed  by  the  officers  of  the  Company. 
The  application  and  medical  examination  are  the  bases 
upon  which  the  policy  is  issued. 

Premium.  The  premium  is  the  stated  sum  the 
insured  pays  to  the  Company  for  the  protection  given. 
It  may  be  paid  in  equal  yearly  sums  continuously  as 
long  as  the  policy  remains  in  force,  or  in  a  limited 
number  of  yearly  payments  as  five,  ten,  twenty,  etc., 
or  in  a  single  sum  called  the  single  premium.  Every 
premium  charged  by  the  Massachusetts  Mutual  is 
made  up  of  three  parts:  First,  the  contribution  to  the 
legal  reserve;  second,  the  contribution  to  current  mor- 
tality; third,  loading  for  expenses  or  contingencies. 

Rebate.  When  an  agent  pays  a  portion  of  the 
premium  to  the  insurant  as  an  inducement  to  insure, 
such  payment  is  called  a  rebate.  Rebating  is  con- 
demned by  the  companies,  is  against  the  best  interests 


DEFINITIONS  31 

of  those  who  insure,  and  is  prohibited  by  the  legislature 
in  nearly  all  the  states.  Severe  penalties  attach  to  this 
practice. 

Renewable  Term.  A  Term  policy  is  sometimes 
written  with  the  privilege  of  renewing  it  at  the  end  of 
the  term  without  re-examination,  but  at  a  highei  rate, 
increasing  with  each  renewal  at  the  advanced  age. 
The  Massachusetts  Mutual  does  not  write  such  a 
renewable  term  policy. 

Renewal  Premium.  A  premium  falling  due  after 
the  first  year  is  called  a  renewal  premium. 

Reserve.  The  reserve  value  of  any  policy  is  made 
up  of  the  accumulations  of  the  balance  of  past  pre- 
miums not  absorbed  by  the  risk  already  incurred. 
Another  definition  of  the  reserve  is  as  follows:  the 
reserve  upon  a  policy  at  any  given  time  is  such  a  sum, 
which  together  with,  future  net  premiums  and  interest 
will  on  the  average  be  exactly  sufficient  to  pay  the 
amount  of  the  policy  when  it  becomes  a  claim.  On 
all  policies  of  insurance  now  being  issued  by  the 
Massachusetts  Mutual  reserves  are  calculated  on  the 
three  per  cent  basis,  American  Experience  Table  of 
Mortality. 

Restoration.  If  the  insured  allows  his  policy  to 
lapse,  or  in  some  other  way  discontinues  the  contract, 
he  has  the  privilege  of  reinstatement  as  long  as  any 
period  of  extended  insurance  has  not  expired  nor  a 
cash  surrender  value  been  taken.  Such  reinstatement 
is  subject  to  satisfactory  evidence  of  insurability  and 
may  often  be  obtained  on  an  unmodified  health  cer- 
tificate in  lieu  of  the  usual  medical  examination. 

Reversionary  Additions.     See  "Paid-Up  Additions." 

State  Supervision.  All  the  states  in  the  Union 
exercise  control  of  the  operations  of  insurance  com- 


32  MASSACHUSETTS   MUTUAL   TEXTBOOK 

panics  doing  business  within  their  limits.  No  company- 
can  do  business  therein  without  permission  of  the 
Insurance  Department.  The  person  at  the  head  of 
such  a  branch  of  state  government  is  usually  called 
the  Insurance  Commissioner.  He  has  authority  to 
demand  statements  from  an  insurance  company  at 
any  time.  He  can  examine  its  books,  look  over  its 
securities,  license  or  withhold  license,  etc.  All  persons 
desiring  to  solicit  insurance  are  required  to  secure  a 
license. 

Surplus.  All  the  property  the  Company  possesses 
in  excess  of  the  reserve  and  all  other  liabilities  is  called 
surplus.  Under  the  Massachusetts  law.  Section  77, 
any  domestic  life  insurance  company  transacting 
business  in  that  state  cannot  hold  or  accumulate  a 
surplus  in  excess  of  twelve  per  cent  of  its  reserve — this 
to  avoid  any  undue  accumulation  of  surplus.  It  is 
very  essential  that  all  life  insurance  companies  have 
on  hand  something  more  than  the  exact  amount 
required  to  carry  out  their  contracts.  They  must 
provide  for  possible  shrinkage  or  depreciation  of 
securities.  A  company  which  has  a  low  death  rate, 
earns  a  fair  rate  of  interest  on  its  assets,  and  is 
economically  managed  will  usually  accumulate  surplus, 
even  more  than  is  necessary  to  safeguard  its  contracts. 
In  such  an  event  a  portion  of  the  amount  is  set  aside 
to  be  returned  to  the  policyholders.  In  the  Massa- 
chusetts Mutual  the  distribution  of  this  surplus  is 
made  every  year. 

In  order  to  apportion  the  surplus,  the  actuary  of  the 
life  insurance  company  must  consider  three  things: 
First,  J:he  saving  in  actual  mor'ality  over  the  expected 
death  loss.  Second,  the  saving  by  actual  expenses  being 
less  than  the  loading.  Third,  the  interest  earned  on 
the  invested  assets.  When  the  amount  of  surplus  is 
determined,  each  policyholder  is  credited  with  a  divi- 
dend in  proportion  to  his  contribution  thereto.    Such 


DEFINITIONS  33 

a  method  of  distributing  surplus  is  called  the  "Contri- 
bution Plan."  The  following  is  a  concrete  illustration 
of  one  method  of  determining  a  dividend  on  an  indi- 
vidual policy:  Policy  on  B's  life  for  $1,000,  fifth  policy 
year,  for  example, — if  the  death  loss  the  preceding  year 
was  but  70%  of  the  expected  mortality  by  the  table, 
30%  of  the  cost  of  insurance  under  B's  policy  would  be 
credited  to  him;  if  interest  earned  upon  the  reserve 
during  the  same  period  was  5%  instead  of  3%  as  re- 
quired, 2%  upon  the  reserve  under  his  policy  would 
also  be  credited  B ;  if  the  expenses  for  the  same  period 
were  only  85%  of  the  loading,  15%  of  the  loading  on 
B's  premium  would  likewise  be  credited  to  him.  The 
sum  of  these  three  items  constitutes  the  dividend  B 
would  receive.  The  Massachusetts  Mutual  Life  In- 
surance Company  employs  a  similar  system.  The 
Company  always  holds  a  part  of  its  surplus  to  protect 
its  policyholders  at  large. 

Taxes.  Each  state  in  which  the  Company  does 
business  imposes  a  tax  usually  upon  the  premiums 
received  from  policyholders  who  are  residents  of  such 
state. 

Temporary  Term  Insurance.  Such  term  insurance 
is  devised  to  fix  the  payment  of  the  annual  premium 
at  a  time  convenient  to  the  insured.  This  plan  is 
calculated  to  furnish  term  insurance  for  a  portion  of 
the  first  year  up  to  the  date  when  the  regular  premium 
comes  due.  Our  Company  requires  that  the  first  regr 
ular  premium  be  paid  along  with  this  temporary  charge. 

Term  Policy.  A  Term  policy  is  one  payable  only 
at  death  within  a  specified  time.  If  death  does  not 
occur  within  such  time,  the  policy  expires  absolutely 
at  the  end  of  the  period.  Rates  are  low,  policy  has 
no  cash  or  paid-up  values  (of  any  account),  and 
returns  of  surplus  are  relatively  small.  All  Term 
policies   issued   by   the    Massachusetts    Mutual    Life 


34  MASSACHUSETTS   MUTUAL   TEXTBOOK 

Insurance  Company  contain  a  provision  for  a  change 
of  plan  within  a  specified  time  without  medical  examina- 
tion. 

Trustee.  Sometimes  the  insured,  instead  of  naming 
in  the  policy  the  person  or  object  he  wishes  as  bene- 
ficiary, prefers  to  have  the  money  paid  to  a  trustee. 


THREE  KINDS    OF  LIFE   INSURANCE 

The  following  itemized  statements  about  the  three 
different  systems  emphasize  the  principal  features  of 
each  without  any  attempt  to  be  exhaustive  or  to 
analyze  each  one  completely. 

THE  ASSESSMENT  SYSTEM 

1.  Premiums.  Ordinarily  called  assessments — are 
required  to  be  paid  after  the  death  of  one  or  more 
members — or  once  a  month— or  once  every  two,  three, 
or  four  months, — the  number  or  amount  being 
determined  by  the  number  of  deaths. 

2.  Contract.  Between  the  society  and  the  member 
is  called  a  certificate.  It  does  not  generally  promise  a 
definite  sum  to  be  paid  the  beneficiary  as  no  provision 
is  made  in  advance  to  do  so. 

3.  Rate  of  Assessments.  Some  claim  a  fixed  rate 
but  do  not  fix  the  number — others  try  to  fix  the  num- 
ber but  not  the  rate.  Assessments  become  very  large 
as  the  average  age  increases.  No  reserve.  In  times 
past  these  societies  have  endeavored  to  grade  rates, 
set  aside  a  mortuary  fund  to  provide  for  excessive 
losses,  accumulate  a  so-called  "Reserve  Fund,"  etc., 
but  in  very  few  cases  have  they  been  able  to  keep  the 
rates  down.  Many  members  leave  when  assessments 
grow  larger. 


DEFINITIONS  35 

4.  Beneficiary.  Must  take  the  pro  rata  share  of 
assessment  collected,  and  often  has  no  redress  if  less 
than  the  face  of  the  certificate  is  paid. 

5.  Liability.  The  insured  is  liable  for  unlimited 
assessments.  He  may  be  uninsurable  when  forced  to 
apply  elsewhere  if  the  society  goes  into  a  receiver's 
hands. 

6.  Fraternities.  This  means,  secret  benevolent 
societies,  whose  chief  purpose  is  to  provide  life  insur- 
ance on  the  assessment  plan.  Their  plan  is  cheaper 
than  that  of  other  assessment  companies,  because 
with  the  lodge  system  the  expense  of  securing  mem- 
bers and  collecting  assessments  is  generally  less. 
Members  are  more  persistent  in  their  payments 
because  of  their  loyalty  to  their  lodge  obligations. 
No  insurance  organization  can  survive  unless  it  pro- 
vides for  deaths  that  come  soon  as  well  as  those  that 
come  later  on — as  shown  by  mortality  tables. 

THE  NATURAL  PREMIUM  SYSTEM 

1 .  Premium  must  be  paid  in  advance. 

2.  The  contract  between  the  company  and  the 
insured  is  called  a  policy. 

3.  The  policy  guarantees  a  definite  sum  to  be  paid 
the  beneficiary. 

4.  The  insurance  is  for  one  year  only,  or  fractional 
part  thereof,  but  can  be  renewed  each  year,  while  in 
force. 

5.  The  premium  is  a  progressive  one — ^gets  larger 
each  successive  year.  It  is  based  on  estimated 
mortality,  interest,  and  expenses. 

6.  The  company  must  have  on  hand  from  the 
beginning  to  the  end  of  each  policy  year  the  reserve 


36  MASSACHUSETTS   MUTUAL   TEXTBOOK 

provided  by  law.  The  best  authorities  say  this 
reserve  at  the  beginning  of  each  year  is  the  net  premium 
at  the  then  age.  At  the  end  of  the  year  no  reserve  is 
required.  If  the  mortality  has  been  less  than  called 
for  by  the  mortality  tables,  the  balance  of  the  fund  is 
carried  to  the  surplus. 

7.  The  objections  to  this  system — increasing 
premiums — no  cash  or  paid-up  values  or  extended 
insurance.  The  system  is  nearly  obsolete,  and  practi- 
cally only  used  by  some  few  companies  as  applying 
to  a  yearly  renewable  term  policy. 

THE  LEVEL  PREMroM  SYSTEM.      "OLD  LINE" 

1.  Premium  must  be  paid  in  advance. 

2.  Contract  of  insurance  is  called  a  policy. 

3.  Policy  designates  a  definite  sum  to  be  paid 
beneficiary. 

4.  The  premium  is  the  same  from  year  to  year, — 
level,  unless  reduced  by  dividends. 

5.  Policyholder  is  insured  for  J  ace  of  the  policy — 
company  has  at  risk  face  of  policy  less  the  reserve. 

6.  Premiums  must  be  computed  on  basis  of  future 
mortality,  interest  earnings  on  reserve,  and  expenses. 

7.  Company  must  keep  on  hand  the  accumulated 
reserves  provided  by  law,  invested  safely  in  securities 
earning  a  rate  of  interest  not  less  than  that  assumed 
when  premium  rates  are  made. 

8.  Advantages  of  this  plan:  Policy  contains  cash 
value,  paid-up  value,  loan  value,  extended  insurance, 
and  except  where  definitely  made  "non-participating" 
shares  in  the  surplus  of  the  company.  Policy  contract 
is  definite  and  absolute. 


DEFINITIONS  37 

LEVEL    PREMroM     INSURANCE— STOCK    AND 
MUTUAL 

Under  this  heading  we  will  consider  briefly  the 
difference  between  two  forms  of  Level  Premium 
Insurance — Stock  and  Mutual. 

STOCK  COMPANY 

A  stock  company  is  one  controlled  by  the  stock- 
holders,— who  own  the  capital  stock.  All  profits, 
surplus,  or  gains  belong  to  the  stockholders,  although 
some  stock  companies  are  limited  by  law  as  to  the 
dividends  they  may  pay  their  stockholders.  In  a  pure 
stock  company  policyholders  receive  no  dividends, 
but  the  net  cost  of  insurance  at  the  beginning  is  usually 
lower  than  on  the  mutual  plan.  Some  stock  com- 
panies write  participating  policies,  which  share  in 
the  surplus  funds  realized  by  the  company.  Such 
companies  are  called  "Mixed"  companies.  In  some 
of  these  mixed  companies,  policyholders  are  allowed 
to  vote  and  hold  office.  Many  leading  companies  which 
have  been  listed  as  mixed  companies  are  retiring  their 
stock,  so  as  to  conduct  all  their  future  business  on 
a  purely  mutual  basis. 

MUTUAL  COMPANY 

A  mutual  company  is  one  which  is  managed 
exclusively  by  its  members.  Every  policyholder  may 
vote  at  any  meeting,  may  be  elected  and  hold  office, 
and  shares  in  all  profits  arising  from  the  business.  Pre- 
miums are  usually  higher  at  the  start  than  with  stock 
companies,  but  the  dividends  declared  soon  bring  the 
cost  down  to  or  below  the  stock  rate.  The  mutual  com- 
pany is  managed  by  a  Board  of  Directors  elected  by 
the  policyholders.  No  member  of  a  mutual  life  insur- 
ance company  can  be  held  personally  liable  for  the 
debts  or  obligations  of  the  corporation. 


12532b 


CHAPTER  IV 


MASSACHUSETTS'    GREAT   RECORD 

The  great  State  of  Massachusetts  is  the  cradle  of 
life  insurance  in  America.  Within  its  borders  the 
business  has  been  constructed  and  developed  into  the 
fullness  of  strength  and  usefulness.  No  legal  reserve 
company  chartered  by  this  Commonwealth  has  failed. 
This  is  considered  a  most  remarkable  record,  deserving 
the  highest  praise. 

We,  who  represent  a  leading  company  of  the  "Old 
Bay  State,"  may  well  be  proud  of  such  a  history. 

Insurance  written  by  the  strong  group  of  excellent 
companies  incorporated  in  Massachusetts  enjoys  an 
enviable  reputation,  and  because  it  is  associated  with 
the  best  practices  of  the  business  the  name  of  this  the 
greatest  of  New  England  States  has  become  a  household 
word  throughout  the  land. 

ELIZUR  WRIGHT 

Great  reforms  are  usually  the  product  of  an  able 
mind  and  an  honest  heart.  Some  one  personality 
moved  by  a  worthy  impulse  starts  out  to  right  the 
wrongs  and  correct  abuses  prevailing  in  some  field  of 
business  activity  or  social  life.  If  the  person  has 
strength  of  character,  possesses  a  high  degree  of 
scholarship,  with  the  courage  of  his  convictions,  he 
will  leave  a  record  the  historian  cannot  ignore.  Such 
a  man  was  EHzur  Wright.  The  State  of  Connecticut 
was  honored  with  his  birth  in  1804.  He  was  graduated 
from  Yale  at  an  early  age.  Shortly  after  his  gradua- 
tion he  became  interested  in  the  slavery  problem  and 
wrote  many  articles  in  favor  of  Abolition.     A  little 


MASSACHUSETTS*   GREAT   RECORD  39 

later  he  was  appointed  professor  of  mathematics  in 
Western  Reserve  University.  Removing  to  Massa- 
chusetts he  became  greatly  interested  in  all  phases  of 
insurance. 

Largely  through  his  efforts  the  Insurance  Depart- 
ment of  Massachusetts  was  inaugurated  in  1855.  He 
was  made  the  first  Commissioner. 

By  his  great  genius  and  intense  earnestness,  backed 
up  by  a  dignified  and  sterling  character,  he  made  the 
office  powerful  and  far-reaching;  even  to  this  day 
the  '  Massachusetts  Insurance  Department  has  tre- 
mendous prestige  throughout  the  whole  country.  He 
went  before  the  legislature  and  presented  his  views  so 
logically  and  forcibly  that  he  secured  passage  of 
several  most  important  bills.  These  laws  have  proven 
a  lasting  bulwark  to  the  cause  of  honest  life  insur- 
ance. 

Elizur  Wright  stood  for  the  following  scientific  and 
economic  principles: 

Net  valuation  laws. 

Non-forfeiture  provisions. 

The  use  of  scientific  tables  of  mortality  and  interest. 

Minimizing  expense  in  conducting  the  business. 

Upon  so  solid  a  foundation  the  present  Massa- 
chusetts Law  has  been  built.  It  is  to-day  regarded  as 
a  praiseworthy  pattern  for  all  the  different  states. 
Unquestionably  this  is  due  to  Elizur  Wright,  who 
discharged  the  duties  of  his  office  with  such  mathe- 
matical skill  and  laudable  integrity  that  no  position  he 
ever  assumed,  looking  to  a  safe  and  creditable  conduct 
of  the  business,  has  ever  been  found  to  be  defective. 
The  fact  that  nearly  all  the  states  to-day  have  adopted 
laws  emphasizing  the  four  basic  principles  for  which 


40  MASSACHUSETTS   MUTUAL  TEXTBOOK 

he  strove,  justifies  the  honor  accorded  him  as  the  Prince 
of  Commissioners. 

This  space  has  been  devoted  to  this  wonderful  man 
because  to  him  more  than  to  any  other  we  owe  the 
sound  and  just  laws  which  regulate  our  domestic 
companies. 


CHAPTER  V 


DIGEST  OF  LAWS  PASSED  BY  THE  STATE  OF 

MASSACHUSETTS  PERTAINING  TO 

LIFE  INSURANCE 

Under  this  heading  it  would  be  impracticable,  if  not 
impossible,  to  itemize  all  of  the  important  provisions 
of  the  Massachusetts  laws  which  have  been  passed  by 
the  Commonwealth  of  Massachusetts  since  1855. 
Therefore  your  attention  will  be  confined  or  called 
only  to  those  features  of  the  law  which  particularly 
affect  the  policy  contract,,  the  general  rights  of  policy- 
holders thereunder,  and  the  measures  taken  to  safeguard 
companies  from  mismanagement. 

For  many  years  it  was  asserted  with  entire  truth  that 
the  insurance  laws  of  Massachusetts  were  better  than 
those  of  any  other  state.  At  the  present  time  a 
claim  for  that  credit  can  hardly  be  substantiated,  as 
equally  desirable  laws  exist  elsewhere.  Many  of 
them,  however,  owe  their  origin  to  the  statutes  of 
Massachusetts.  Our  solicitors  can  truthfully  state 
that  our  insurance  legislation  is  equal  to  any,  and 
superior  to  much  that  is  in  force  in  other  states. 

A  PIONEER 

It  should  be  borne  in  mind  that  Massachusetts  was 
the  pioneer  in  constructive  and  remedial  legislation, 
looking  to  the  supervision  of  insurance  companies 
and  the  establishment  and  protection  of  the  rights  of 
policyholders.  The  first  Insurance  Department  pro- 
viding for  the  control  of  the  insurance  business  on 
a  somewhat  scientific  basis,  was  established  in  1855. 
This  Department,  comprehensive  in  its   duties   and 


42       MASSACHUSETTS  MUTUAL  TEXTBOOK 

efficient  in  its  conduct,  has  not  been  excelled  by  the 
Department  of  any  other  state. 

IMPORTANT  PRINCIPLES 

The  most  important  principles  upon  which  modern 
life  insurance  rests,  both  in  this  country  and  abroad, 
embodied  in  the  statute  laws  of  Massachusetts  through 
the  efforts  of  Elizur  Wright,  are  as  follows.:  first,  the 
insurance  companies  should  establish  and  maintain 
sufficient  legal  reserves  to  enable  them  to  fulfill  their 
contracts;  second,  the  policy  should  have  a  surrender 
value  in  case  of  lapse;  third,  the  policy  should,  unless 
non-participating,  share  in  surplus  annually.  It  was 
not  until  years  after  these  basic  ideas  had  taken  root 
in  Massachusetts  that  they  were  generally  adopted  in 
other  states. 

ACTS  OF  1858  AND  1861 

In  1858  a  law  was  passed  under  which  life  insurance 
companies  were  required  to  maintain  a  legal  reserve. 
While  under  this  Act  solvency  of  the  insurance  com- 
panies was  established,  it  failed  to  recognize  and 
protect  the  just  and  equitable  rights  of  policyholders 
to  a  vested  interest  in  the  reserve  in  the  event  of  the 
lapse  of  their  policies.  In  1861  Wright  secured  the 
passage  of  the  Act  known  as  the  Massachusetts  Non- 
forfeiture Law  of  1861.  This  was  the  first  statute 
creating  a  surrender  value  for  lapsed  policies,  and  forms 
the  basis  of  the  present  so-called  non-forfeiture  laws 
now  in  force  in  Massachusetts  and  throughout  the 
country.  It  provided  in  substance  that  no  policy  of 
life  insurance  thereafter  issued  should  become  wholly 
forfeited  or  void  with  the  non-payment  of  a  premium, 
but  that  a  portion  of  the  reserve  thereunder,  ascertained 
in  accordance  with  the  Act,  should  be  applied  as  a  net 
single  premium  to  the  purchase  of  extended  term  in- 
surance for  the  face  of  the  policy,  according  to  the  age  of 
the  insured  at  the  time  of  the  lapse. 


DIGEST   OF  MASSACHUSETTS  LAWS  43 

Since  the  passage  of  this  Act  the  law  in  Massachu- 
setts relative  to  surrender  values  and  non-forfeiture 
benefits  has  been  developed  by  a  number  of  statutes 
passed  from  time  to  time.  It  is  perhaps  only  necessary 
to  point  out  the  most  important  features  of  these  laws, 
as  the  changes  in  minor  details  are  now  unimportant 
in  this  connection. 

ACT  OF  1880 

The  Act  of  1880,  Chapter  232,  affecting  all  policies 
issued  on  and  after  January  1,  1881,  provided  that 
after  two  full  annual  premiums  should  have  been  paid, 
upon  default  in  the  payment  of  any  subsequent  premium 
the  policy  should  become  binding  on  the  company  for  an 
amount  of  paid-up  insurance  which  its  then  net  value 
would  purchase  as  a  net  single  premium  for  life  insurance 
maturing  in  the  same  manner  and  at  the  same  time  as 
the  original  policy,  and  prescribing  the  rule  for  as- 
certaining such  net  value.  The  Statute  also  provided 
that  after  the  insurable  interest  in  the  life  insured  had 
terminated,  such  net  value  should  be  a  surrender 
value  payable  in  cash  to  the  insured,  and  further 
provided  that  such  insuraMe  interest  should  be  deemed 
to  have  terminated  when  the  insured  had  no  minor  or 
dependent  child,  and  his  wife,  if  any,  and  any  living 
beneficiary  named  in  the  policy,  should  join  in  the 
application  for  its  surrender. 

ACT  OF  1887 

The  Act  of  1880  was  amended  by  the  Act  of  1887, 
Chapter  214,  Section  76,  so  that  the  holder  of  a  policy 
which  had  become  paid-up  after  the  payment  of  two 
full  annual  premiums,  became  entitled  on  any  sub- 
sequent anniversary  of  the  policy  to  surrender  the  same 
to  the  company,  with  the  written  assent  of  the  person  to 
whom  it  was  made  payable,  for  its  net  value  payable  in 
cash,  thus  making  the  cash  surrender  value  available  to 
the  insured  whether  or  not  the  insurable  interest  in  his 
lifie  had  terminated  under  the  rule  of  the  Statute  of  1880. 


44  MASSACHUSETTS   MUTUAL  TEXTBOOK 

ACT  OF  1894 

The  law  was  further  amended  by  the  Act  of  1894, 
Chapter  522,  Section  76,  so  that  cash  surrender  values 
should  apply  to  policies  which  had  become  paid-up  in 
accordance  with  their  terms  as  well  as  to  policies  which 
had  become  paid-up  in  consequence  of  default  in 
premium  payments. 

ACTS  OF  1896  AND  1900 

In  18Q6  a  minor  amendment  as  to  the  amount  of  the 
surrender  charge  in  case  of  Endowment  policies  was 
made,  otherwise  the  law  remained  unchanged  until 
1900,  when,  by  Section  3,  Chapter  363,  of  the  Acts  of 
that  year,  it  was  further  amended  so  that  the  payment 
of  three  full  annual  premiums  was  required  before  the 
policy  became  non-forf citable,  and  by  the  inclusion  of 
the  following  provision,  "But  any  company  may 
contract  with  its  policyholders  to  furnish,  in  lieu  of  the 
paid-up  insurance  provided  for  in  this  section,  any 
other  form  of  life  insurance  lawful  in  this  Commonwealth 
of  not  less  value.''  Under  this  provision  companies 
were  enabled  to  give  extended  insurance  in  lieu  of 
paid-up  insurance,  if  so  desired  by  the  policyholder, 
extended  insurance  not  having  been  legally  permissible 
under  any  policies  issued  since  the  law  of  1880  went 
into  effect. 

ARMSTRONG  INVESTIGATION 

Following  the  investigation  of  the  so-called  Arm- 
strong Committee  of  the  New  York  Legislature  in 
1906,  when  the  attention  of  all  legislative  bodies  had 
been  directed  to  the  regulation  of  the  insurance 
business,  the  Legislature  of  Massachusetts  authorized 
a  Joint  Special  Committee  on  Insurance  to  revise  and 
arrange  the  laws  of  the  State  relative  to  insurance. 

This  joint  legislative  committee  was  not  appointed 
for  the  purpose  of  investigating  Massachusetts  com- 


DIGEST   OF   MASSACHUSETTS   LAWS  45 

panics,  but  to  thoroughly  consider  the  revision  of  the 
Insurance  Laws  of  the  State,  which  had  received  no 
general  or  thorough  revision  for  nearly  twenty  years. 

No  criticism  was  made  of  any  Massachusetts 
company  as  a  result  of  the  Armstrong  Investigation, 
and  the  Massachusetts  Mutual  Life  Insurance  Com- 
pany was  referred  to  in  the  Report  of  the  Committee 
as  a  company  that  procured  its  new  members  on 
an  economical  basis. 

ACT  OF  1907 

Based  upon  the  findings  of  the  Massachusetts 
Legislative  Committee,  Chapter  576  of  the  Acts  of 
1907  was  passed  which  went  into  effect  July  28, 
1907.  Under  this  Act  changes  were  made  in  the 
Insurance  Laws,  and  new  features  were  introduced. 
It  was  provided,  among  other  things,  that  all  policies 
issued  in  the  State  of  Massachusetts  should  contain 
the  provision,  with  which  we  are  now  familiar,  as 
to  a  grace  period  of  thirty-one  days  in  the  payment  of 
premiums,  incontestability  after  two  years,  annual  divi- 
dends, options  in  case  of  default,  right  to  loans  upon  the 
sole  security  of  the  policy,  reinstatement  within  three  years 
from  date  of  default,  and  others  not  less  noteworthy. 
Perhaps  the  most  important  of  these  provisions  were* 

(a)  Non-forfeiture  benefits:  That  the  insured 
should  be  entitled,  in  case  of  default  after  the 
payment  of  three  full  annual  premiums,  to  elect  to 
take  either  the  cash  surrender  value  of  the  policy, 
a  paid-up  policy,  or  extended  term  insurance  for 
the  face  of  the  policy  (Section  80) ;  the  Massa- 
chusetts Mutual  contract  however  gives  these 
values  after  two  years'  premiums  have  been  paid. 

(b)  Policy  loans :  That  the  insured  should  have 
the  Hght  to  policy  loans  from  the  company  upon 
the  sole  security  of  the  policy  in  a  sum  not  less 


46  MASSACHUSETTS    MUTUAL   TEXTBOOK 

than  ninety-five  per  cent  of  the  cash  value  of  the 
poHcy  and  all  dividend  additions  thereto  (Section 
78). 

(c)  Annual  dividends:  That  companies  other 
than  those  that  issue  only  non-participating 
policies  should  make  distribution  of  their  surplus 
to  policyholders  upon  the  contribution  to  surplus 
plan,  annually,  beginning  not  later  than  the  end  of 
the  third  policy  year,  and  that  such  distribution,  or 
dividends  so-called,  should  either  be  paid  in  cash, 
applied  in  reduction  of  premiums,  or  used  to  pur- 
chase paid-up  additions,  or  should  be  left  with  the 
company  to  accumulate,  withdrawable  in  cash  by  the 
insured,  as  might  be  elected  by  the  insured  in  accord- 
ance with  the  terms  of  the  policy  (Section  76). 

While  this  statute  has  been  amended  several  times 
in  certain  particulars,  all  the  substantial  rights  thereby 
conferred  are  embodied  in  the  present  statutes  and  in 
our  current  policy  forms — many  features  of  which  are 
even  more  liberal  than  the  legal  requirements. 


ANNUAL  DIVIDENDS 

From  the  year  1854  down  to  the  year  1900  the  laws 
governing  the  distribution  of  the  surplus  of  insurance 
companies  to  their  policyholders  permitted  such 
distributions  to  be  made  annually  or  once  in  every 
two,  three,  four,  or  five  years,  as  might  be  determined  by 
the  directors.  In  1900  the  law  was  so  amended  that 
companies  might  make  to  policyholders  "from  time  to 
time"  distributions  of  surplus  not  inconsistent  with 
the  terms  of  the  policies.  By  the  above  mentioned 
Act  of  1907 ,  however,  as  has  been  stated,  the  annual 
distribution  of  surplus  was  made  obligatory  upon  all 
companies  (other  than  those  issuing  only  non-partici- 
pating policies)  doing  business  in  Massachusetts. 


DIGEST  OF  MASSACHUSETTS  LAWS  47 

VALUATION  OF  POLICIES  UNDER  MASSACHUSETTS 
LAWS 

From  the  beginning  of  the  practice  of  valuation  of 
policies  to  the  end  of  the  year  1900,  the  Actuaries'  or 
Combined  Experience  Table  of  Mortality  and  four  per 
cent  interest  was  the  sole  standard  of  .  valuation  in 
Massachusetts. 

Under  the  present  law  of  Massachusetts,  the 
minimum  standard  of  valuation  for  policies  issued  since 
1900  is  the  American  Experience  Table  of  Mortality 
and  three  and  one-half  per  cent  interest,  but  companies 
are  allowed  to  value,  if  they  desire,  on  the  basis  of  the 
American  Experience  Table  and  three  per  cent  interest. 
For  policies  issued  prior  to  1901  the  standard  is  still  the 
Actuaries'  Table  and  four  per  cent  interest. 

All  Massachusetts  Mutual  policies  issued  since 
October  1,  1907,  are  valued  according  to  the  American 
Experience  Table  of  Mortality  and  3%  interest. 

INVESTMENT  OF  ASSETS 

By  the  statutes  of  Massachusetts  it  is  provided  that 
three-fourths  of  the  reserve  of  domestic  mutual  life 
insurance  companies  shall  be  invested  in  certain 
specified  ways.  These  include,  among  other  things, 
mortgages  upon  real  estate,  which  shall  be  a  first  lien 
upon  the  property  covered  and  shall  not  exceed  sixty 
per  cent  of  the  fair  market  value  of  the  property  at 
the  time  of  the  loan.  The  statute  further  requires 
that  in  connection  with  mortgage  loans  every  member 
of  the  finance  committee  who  approves  an  application 
for  a  loan  shall  sign  a  certificate  as  to  the  value  of  the 
property  covered  by  the  mortgage,  which  certificate  is 
made  a  matter  of  record  for  the  company. 

The  statute  further  authorizes  investments  in  public 
funds  of  the  United  States  or  any  state  or  any  city  of  the 


48       MASSACHUSETTS  MUTUAL  TEXTBOOK 

United  States,  in  certain  bonds  or  notes  of  counties, 
cities  or  towns  or  school  or  water  districts,  and  also  in 
certain  specified  bonds  or  notes  of  steam  railroads  and 
street  railroads. 

In  addition  to  these  classes  of  investments,  it  is 
provided  that  such  companies  may  invest  in  such  real 
estate  as  shall  be  necessary  for  the  transaction  of  the 
company's  business,  in  loans  upon  the  security  of  its 
own  policies,  not  exceeding  the  legal  reserve  on  the 
policy,  and  in  loans  secured  by  collateral  consisting  of 
any  of  the  kinds  of  security  in  which  it  is  legal  for  such 
companies  to  invest.' 

It  is  further  provided  that  the  balance  of  the  assets 
of  the  company  beyond  the  three-fourths  of  the 
reserve,  which  balance  would,  of  course,  include  the 
remaining  one-fourth  of  the  reserve  and  the  surplus 
funds  of  the  company,  may  be  invested  in  any  manner 
that  the  directors  may  determine,  with  the  prohibition 
against  investments  in  certain  specified  ways  named  in 
the  statute — which  it  is  not  necessary  to  enumerate 
here. 

PECULIAR  BENEFITS  FIXED  BY  MASSACHUSETTS  LAW 

Under  the  provisions  of  Section  73  of  the  Insurance 
Law  of  Massachusetts,  it  is  provided  that  the  proceeds 
of  any  policy  of  insurance  in  favor  of  a  person,  other 
than  the  person  insured,  having  an  insurable  interest 
in  the  life  insured,  shall  be  free  from  the  claims  of 
creditors  and  representatives  of  such  insured,  excepting, 
however,  as  to  the  amount  of  premiums  paid  for  such 
insurance  in  fraud  of  creditors  with  the  interest  thereon, 
and  that  policies  payable  to,  or  for  the  benefit  of,  a 
married  woman,  or  subsequently  assigned,  transferred, 
or  in  any  way  made  payable  to  a  married  woman,  or 
to  any  person  in  trust  for  her  or  for  her  benefit,  whether 
procured  by  herself  or  by  any  one  else,  shall  inure  to 
her  separate  use  and  that  of  her  children,  subject  to 


DIGEST  OF  MASSACHUSETTS   LAWS  49 

the  foregoing  provisions  as  to  premiums  paid  in  fraud 
of  creditors.  This  latter  provision  is  important  and 
somewhat  peculiar,  as  a  policy  thus  payable  to  a 
married  woman,  in  the  absence  of  any  second  bene- 
ficiary, would,  if  she  died  before  the  insured,  unless 
previously  disposed  of  by  her,  pass  to  her  then  living 
children  and  not  to  her  legal  representative. 

The  statute  whereby  a  policy  payable  to  a  married 
woman,  inured,  at  her  death,  to  her  children,  which 
was  first  enacted  in  1844,  was  not  in  force  as  to 
policies  issued  between  May  20,  1887,  and  March  15, 
1894.  During  this  period,  policies  so  payable  to 
a  married  woman  would,  unless  otherwise  specified 
therein,  become  at  her  death  a  part  of  her  general 
estate,  instead  of  inuring  to  the  benefit  of  her  children. 

It  may  be  of  interest  that  the  Supreme  Judicial  Court 
of  Massachusetts,  in  the  case  of  Tyler,  Administratrix, 
vs.  The  Treasurer  and  Receiver  General,  decided 
March  6,  1917,  that  the  proceeds  of  life  insurance 
policies  payable  to  a  named  beneficiary,  even  though 
the  right  to  change  the  benefit  has  been  reserved,  are  not 
subject  to  the  Legacy  and  Succession  Tax  of  this 
State.  This  question  has  often  been  asked,  but  it  is 
doubtful  whether  it  has  ever  been  squarely  decided 
before  by  a  court  of  last  resort  in  this  country.  This 
decision  ought  to  have  great  weight  in  case  the  question 
is  raised  in  other  states  under  similar  statutes. 

EXPENSES 

There  is  no  limitation  imposed  by  the  laws  of  Mas- 
sachusetts on  the  expenses  to  be  incurred  in  the 
management  of  life  insurance  companies.  It  may  be 
noted,  however,  that  all  life  insurance  companies 
doing  business  in  the  State  of  New  York  must  conform 
their  methods  to  the  requirements  of  the  New  York 
Statutes  in  this  respect,  whereby  certain  limitations 
of  expenses  are  imposed,  and  therefore  such  companies 


so  MASSACHUSETTS   MUTUAL   TEXTBOOK 

are  on  an  equal  footing  with  New   York  companies 
in  this  regard. 

ASSESSMENT  COMPANIES 

Since  July  1,  1899,  it  has  been  unlawful  for  any 
insurance  policies  on  the  assessment  plan  to  be  issued 
within  the  State  of  Massachusetts. 

MASSACHUSETTS  GENERAL  HOSPITAL  INSURANCE 
COMPANY 

When  the  Massachusetts  Mutual  Life  Insurance 
Company  received  its  charter,  a  clause  therein  provided 
that  one-third  of  the  net  profits  arising  from  insurance 
on  lives,  made  during  the  preceding  year,  should  be 
paid  to  the  Massachusetts  General  Hospital.  The 
following  is  the  section : 

Sec.  9.  The  said  corporation  shall,  on  the 
third  Monday  of  January,  in  every  year,  pay 
over  to  the  trustees  of  the  Massachusetts  General 
Hospital,  one-third  of  the  net  profits,  if  any, 
which  shall  have  arisen  from  insurance  on  lives, 
made  during  the  preceding  year. 

Similar  or  identical  provisions  are  contained  in  the 
charters  of  all  life  insurance  companies  incorporated 
under  special  laws  in  Massachusetts  prior  to  1856. 
In  that  year  a  general  law  was  passed  subjecting  all 
Massachusetts  companies  to  the  same  obligations. 
These  provisions  are  wholly  inoperative  as  to  mutual 
life  insurance  companies  having  no  capital  stock,  for 
the  reason  that  such  companies  have  no  "profits" 
upon  which  any  payment  to  the  Hospital  could  be 
based.  On  this  account  all  general  laws  relative  to 
those  provisions  have  been  repealed.  While  the 
charter  of  this  Company  has  not  been  specifically 
amended  in  this  respect,  such  repeals  in  effect  constitute 
an  amendment.     By  statute  in  Massachusetts,  since 


DIGEST   OF   MASSACHUSETTS   LAWS  51 

1831  all  acts  of  incorporation  were  granted  subject  to 
alteration,  amendment,  or  repeal  by  the  Legislature. 
Our  Company  and  all  other  companies  have  more 
widely  different  and  increased  powers  under  the  general 
laws  relating  to  insurance  than  are  granted  in  their 
charters.  For  example,  there  are  several  provisions 
in  our  charter  relative  to  dividends  or  distribution  of 
surplus,  which  are  now  wholly  inoperative  on  account 
of  the  change  in  the  general  law.  Therefore,  when  the 
general  law,  above  referred  to,  imposing  this  obligation 
to  the  Hospital,  was  repealed  in  1887,  it  was  in  effect 
a  repeal  of  this  provision  of  the  Company's  charter. 

No  payment  has  ever  been  made  by  the  Company  to 
the  Massachusetts  General  Hospital,  and  no  demand 
has  ever  been  made  upon  the  Company  by  the  Hospital 
for  a  payment  or  an  accounting  under  the  terms  of  the 
original  charter. 

The  Company's  guaranty  capital  was  finally  retired 
in  1867,  and  since  that  time  there  has  been  no  possible 
basis  upon  which  this  provision  could  have  been 
operative  even  if  it  had  continued  in  effect. 

There  are  many  more  provisions  of  the  Massa- 
chusetts Insurance  Laws  relating  to  the  organization, 
control,  and  general  conduct  of  the  business,  which, 
though  important,  are  not  of  general  interest  and  are 
not  here  mentioned. 

A  copy  of  the  law  will  give  you  any  specific  informa- 
tion desired. 


CHAPTER   VI 


OUR   POLICY   CONTRACT 

A  policy  of  life  insurance  in  the  Massachusetts 
Mutual  Life  Insurance  Company  very  clearly  explains 
the  obligations  imposed  upon  the  Company  as  the 
party  of  the  first  part  and  the  insured  as  the  party  of 
the  second  part.  Being  in  the  eyes  of  the  law  a  contract, 
each  party  thereto  must  comply  absolutely  with  the 
terms  and  conditions  stipulated  in  the  policy.  A 
contract'is  made  to  be  kept. 

The  Company  furnishes  all  its  agents  with  specimen 
policies  and  descriptive  circulars.  //  is  expected  that 
each  respresentative  of  the  Company  who  attempts 
to  sell  our  policies  shall  be  thoroughly  acquainted  with 
all  provisions,  requirements,  guaranties,  and  benefits 
contained  therein. 

Ignorance  is  no  excuse  for  failure.  The  better  the 
solicitor  knows  his  goods,  the  more  attractive  he  can 
make  their  advantages.  There  are  many  perfectly 
wonderful  combinations  of  options  and  other  features 
of  our  policies  that  a  little  thorough  study  will  reveal — 
a  little  more  study  will  make  available  in  field  work. 

The  aim  of  the  Home  Office  has  always  been  to 
simplify  the  terms  and  conditions  of  our  policies  so  one 
of  ordinary  intelligence  could  easily  comprehend 
them.  Nothing  complex  or  abstruse  is  allowed  space 
on  any  page.  To  meet  changing  conditions  which 
come  with  advancing  years,  forms  of  policies  as  well  as 
provisions  and  privileges  therein  will  be  modified, 
revised,  improved — the  better  to  fit  every  human  need. 


OUR  POLICY  CONTRACT  53 

The  Company  has  therefore  thought  it  unwise  to 
attempt  a  comprehensive  analysis  of  our  policies 
herein,  believing  it  would  soon  be  out  of  date  and 
worthless.  Forms  of  contracts  are  already  elaborated 
by  circulars — changes  will  be  bulletined  from  time  to 
time  as  made.  A  brief  description  of  several  of  the 
more  commonly  used  forms  will  be  found  under  a 
following  heading. 

KINDS   OF  POLICIES 

The  Massachusetts  Mutual  Life  Insurance  Company 
issues  all  desirable  forms  of  Life  and  Endowment 
insurance,  with  flexible  benefits  to  the  insured  and 
beneficiary.  Among  the  standard  kinds  of  policies  on 
the  Life  plan  are:  Ordinary  Life,  Single  Payment, 
Five  Payment,  Ten  Payment,  Fifteen  Payment, 
Twenty  Payment,  Twenty-five  Payment,  and  Thirty 
Payment  Life.  Under  the  Endowment  might  be 
mentioned  the  Single  Payment,  Ten,  Fifteen,  Twenty, 
Twenty-five,  Thirty,  Thirty-five,  Forty,  Forty-five, 
and  Fifty  Year  Endowments ;  Endowments  maturing 
at  fixed  ages,  and  Twenty  Payment  Endowments 
maturing  at  fixed  ages.  Term  Policies  are  issued  for 
varying  periods,  usually  five  and  ten  years.  Joint 
policies  on  two  lives  are  issued  on  the  Ordinary  Life, 
Twenty  Payment  Life,  Twenty  Year  Endowment,  etc. 
See  Instruction  Manual  and  Rate  Book  for  particulars. 
Installment  options  are  placed  upon  all  policies  except 
those  issued  on  the  continuous  income  plan.  The 
continuous  monthly  income  feature  may  be  applied  to 
ell  Life  and  Endowment  policies. 


COMMONLY  USED  FORMS  IN  BRIEF 
ORDINARY  LIFE  POLICY 

An  Ordinary  Life  policy  is  one  which  covers  an 
insurance  for  the  entire  term  of  life.     The  premiums 


S4  MASSACHUSETTS  MUTUAL  TEXTBOOK 

are  payable  during  the  entire  life  of  the  policyholder. 
The  policy  shares  in  the  surplus,  has  cash,  paid-up, 
extended  term  insurance,  loan,  and  other  values.  It 
also  contains  various  options  granted  by  the  Company 
and  the  Total  Disability  clause  if  desired.  If  the 
insured  lives  to  the  age  of  96,  the  Company  will  pay 
the  face  of  the  policy  in  full  as  an  endowment, 

TWENTY  PAYMENT  LIFE  POLICY 

The  Twenty  Payment  Life  policy  is  one  which  covers 
an  insurance  for  the  entire  term  of  life  but  requires 
only  twenty  annual  payments.  It  contains  all  the 
features  found  in  the  Ordinary  Life  policy  and,  in 
addition,  the  Endowment  option. 

TWENTY  YEAR  ENDOWMENT 

A  Twenty  Year  Endowment  policy  is  one  which 
covers  an  insurance  for  twenty  years,  and  its  face  is 
then  payable  to  the  insured,  if  living.  It  contains  all 
the  benefits  and  guarantees  contained  in  the  life 
policies.  Endowment  insurance  is  a  combination  of 
life  insurance  and  savings  available  for  a  definite 
amount  at  a  desired  time.  Proceeds  of  the  policy 
will  be  paid  in  installments  if  desired. 

TEN  YEAR  TERM  POLICY 

A  Ten  Year  Term  policy  is  one  which  provides  in- 
surance for  ten  years  only.  It  is  somewhat  like  fire' 
insurance.  It  expires  at  the  end  of  the  term  without 
value.  Disability  feature  not  provided  on  any  term 
plan. 

Study  Book  of  Instructions  and  Circulars  for 
detailed  analysis  of  all  forms  of  policies. 

The  CARDINAL  FEATURES  of  our  present 
policies  worthy  of  emphasis,  and  many  of  £hem  exclu- 


OUR   POLICY  CONTRACT  55 

sively  our  own,   are  enumerated  under  the  following 
heading : 


FACTS   WORTH   KNOWING 

1.  Do  you  know  that  an  entire  year's  dividend  is 
allowed  at  the  end  of  each  policy  year,  whether  the 
premium  then  due  is  paid  or  not? 

2.  Do  you  know  that  the  dividend  can  be  taken  in 
cash? 

3.  Or,  can  be  used  each  year  to  reduce  the  premium 
payment? 

4.  Or,  if  desired,  will  buy  a  paid-up  participating 
addition  to  the  policy? 

5.  And  if  used  to  buy  additions,  do  you  know  that 
these  additions  may  be  surrendered  for  their  cash 
value? 

6.  Do  you  ^Mow  that,  if  preferred,  dividends  can  be 
left  with  the  Company  to  accumulate  at  compound 
interest?  And  should  the  policyholder  die  while  any 
dividends  remain  credited  to  his  policy,  all  such 
dividends  would  be  paid  to  the  beneficiary  in  addition 
to  the  face  of  the  policy. 

7.  Do  you  know  that  the  whole  or  any  part  of  the 
sum  so  accumulated  may  be  at  any  time  withdrawn 
in  cash? 

8.  Do  you  know  that,  unless  so  withdrawn,  the 
premium-paying  period  can  be  reduced  by  the  use 
of  accumulated  dividends? 

9.  Do  you  know  that  through  dividend  accumula- 
tions a  Life  policy  can  become  payable  as  an  Endow- 


56       MASSACHUSETTS  MUTUAL  TEXTBOOK 

ment,  or  the  payment  of  an  Endowment  policy  be 
hastened  ? 

10.  Do  you  know  that,  without  action  by  the 
insured,  dividend  accumulations  will  be  used,  if 
sufficient  therefor,  to  pay  a  premium  that  is  unpaid 
at  the  end  of  the  grace  period  ? 

11.  Do  you  know  that  there  is  a  provision  for  31 
days  of  grace,  without  charge,  in  the  payment  of  all 
premiums  after  the  first? 

12.  Do  you  know  that  the  policy  will  contain,  on 
request  of  the  insured,  a  waiver  of  future  premium 
payments  if  the  insured,  before  attaining  age  60,  be- 
comes permanently  and  totally  disabled,  or  loses  sight 
of  both  eyes,  or  loses  both  hands  or  both  feet,  or  one 
hand  and  one  foot? 

13.  Do  you  know  that  the  policy  contains  an  agree- 
ment to  loan  ? 

14.  Do  you  know  that  if  a  loan  is  made,  it  may  be 
for  the  entire  cash  value? 

15.  Do  you  know  that  there  is  a  provision  for 
premium  loans  and  that  they  can  be  made  automatic? 

16.  Do  you  know  that  the  policy  says  that  the 
whole  or  any  part  of  a  loan  may  be  repaid  at  any  time? 

17.  Do  you  know  that  the  policy  is  without  re- 
strictions upon  travel,  residence,  and  occupation 
(except  military  and  naval  service — see  policy)  ? 

18.  Do  you  know  that  the  policy  is  incontestable 
after  the  first  policy  year  except  for  non-payment  of 
premium,  and  for  violation  of  the  military  and  naval 
provisions? 


OUR    POLICY   CONTRACT  57 

19.  Do  you  know  that  the  policy  provides  for  cash 
surrender,  or  automatic  paid-up  insurance,  or  auto- 
matic extended  term  insurance,  in  case  of  failure  to 
pay  a  premium  after  two  annual  premiums  have  been 
paid? 

20.  Do  you  know  that  if  no  choice  is  made,  paid- 
up  insurance  will  be  binding  upon  the  Company 
WITHOUT  ANY  ACTION  BY  THE  INSURED? 

21.  Do  you  know  that  if  the  policy  lapses  and 
becomes  paid-up,  application  for  reinstatement  can 
be  made  at  any  time? 

22.  Do  you  know  that  such  paid-up  insurance 
WILL  PARTICIPATE  IN  DIVIDENDS? 

23.  Do  you  know  that  it  may  be  surrendered  for 
its  cash  value? 

24.  Do  you  know  that  its  cash  value  increases  from 
year  to  year? 

25.  Do  you  know  that  extended  term  insurance  has 
a  cash  surrender  value,  and  participates  in  annual 
dividends  if  the  extension  period  is  a  year  or  more? 

26.  Do  you  know  that  if  extended  insurance  is 
taken  and  has  not  expired,  application  can  be  made 
for  reinstatement  of  the  original  policy? 

27.  Do  you  know  that  if  death  occurs  within  the 
extension  period,  the  policy  is  paid  without  premium 
deduction  ? 

28.  Do  you  know  that  if  the  installment  feature  in 
paying  the  policy  is  offered,  the  applicant  is  given 
several  options  to  choose  from? 


58  MASSACHUSETTS   MUTUAL   TEXTBOOK 

29.  Do  you  know  that  provision  is  made  for  annual, 
semi-annual,    quarterly,    or    monthly    installments? 

30.  Do  you  know  that  installments  will  be  paid  as 
long  as  the  beneficiary  lives,  if  desired? 

31.  Do  you  know  that  they  may  be  for  a  definite 
term  of  years,  to  be  chosen  by  the  insured  ? 

32.  Do  you  know  that  part  of  the  policy  can  be 
paid  in  cash  and  the  remainder  in  installments? 

33.  Do  you  know  that  an  annual  interest  dividend 
is  paid  in  addition  to  the  installments? 

34.  Do  you  know  that  the  policy  contains  a  provi- 
sion for  leaving  the  proceeds  with  the  Company  and  the 
payment  of  interest  thereon  to  the  beneficiary? 

35.  Do  you  know  that  the  policy  is  paid  immediately 
on  receipt  of  due  proof  of  death  ? 

If  you  do  not  thoroughly  know  all  of  the  above 
thirty- five  very  important  features  of  our  policies,  study 
them  until  you  do. 

PROVISION  FOR  WAIVER  OF   PREMIUM 

In  the  event  of  permanent  total  disability,  and 
after  payment  of  the  premiums  for  the  first  policy 
year,  and  before  default  in  the  payment  of  any 
subsequent  year's  premium,  and  before  attaining  the 
age  of  sixty  years,  if  the  insured  furnish  due  proof  to 
the  Company  at  its  Home  Office  that  he  has  become 
wholly  and  permanently  disabled  by  bodily  injury  or 
disease,  the  Company  will  waive  the  payment  of  all 
premium  payments  due  under  his  policy  after  the 
expiration  of  the  then  current  policy  year.  Premiums 
so  waived  shall  not  be  deducted  from  the  sum  payable 
under  the  policy.     The  Company  may  demand  from 


OUR   POLICY   CONTRACT  59 

time  to  time  due  proof  of  the  continuance  of  such 
disabiHty,  and  if  the  insured  shall  fail  to  furnish  such 
proof,  all  premiums  thereafter  falling  due  must  be 
paid  according  to  the  terms  of  the  policy.  If  premiums 
are  waived  under  this  clause,  dividend  payments 
continue,  and  the  cash  value  of  the  policy  increases 
each  year,  exactly  as  if  premium  payments  were  being 
made,  and  the  other  benefits  provided  in  the  policy 
are  in  nowise  affected.  This  provision  may  be 
discontinued  at  the  option  of  the  insured.  Upon 
entering  military  or  naval  service  in  time  of  war, 
benefits  under  this  provision  will  immediately  cease. 
No  waiver  of  premium  will  be  attached  to  any  policy 
issued  at  any  age  above  fifty-five.  When  the  insured 
who  holds  a  policy  taken  at  age  below  fifty-five  reaches 
age  60,  the  premium,  if  any,  will  be  reduced  to  a 
corresponding  premium  for  a  policy  without  the 
disability  agreement.  This  waiver  may  be  attached 
to  old  policies  in  accordance  with  the  Company's 
rules.  Rates  to  secure  this  waiver  of  premium  will 
be  found  in  the  Rate  Book.  The  Company  will  not 
grant  this  provision  on  any  Term  policy. 


ENDOWMENT  OPTION 

This  feature  applies  to  all   Limited  Payment  Life 
policies  issued  on  and  after  January  1,  1917. 

By  means  of  this  option,  the  insured  can 
convert  a  Limited  Payment  Life  policy  into  an 
Endowment. 

To  do  so,  it  becomes  necessary  to  continue 
payments  on  the  Limited  Payment  policy  after 
the  required  payments  have  been  made — for 
a  definite  number  of  years  stated  in  the  policy. 

When  the  required  number  of  extra  payments 
have   been    made,    the    Company    will   pay    the 


60  MASSACHUSETTS   MUTUAL   TEXTBOOK 

insured  the  face  of  the  policy  and  any  additional 
amount  that  may  be  due.     See  rate  book. 

In  event  of  death  during  the  payment  of  the 
required  extra  premiums,  only  the  face  of  the 
policy,  plus  any  dividend  accumulations  or  paid- 
up  additions,  will  be  paid. 

The  endowment  option  may  not  be  elected  if 
any  premium  has  been  waived  on  account  of  dis- 
ability. 

The  policy  to  be  issued  on  the  election  of  this 
option  will  not  contain  the  provision  for  waiver  of 
premium. 

The  policy  participates  in  the  Company's 
surplus,  and  contains  loan  and  surrender  values 
larger  than  for  corresponding  years  under  the 
original  policy. 

Example:  A  policyholder,  age  30,  takes  a 
Fifteen  Payment  Life  policy  for  $10,000,  electing 
the  Endowment  Option.  After  paying  Fifteen 
years,  he  may  continue  to  pay  a  premium  of  like 
amount  for  a  further  period  of  ten  years.  At  the 
end  of  that  period  he  will  receive  $10,370.  This 
does  not  include  any  dividend  accumulations  or 
paid-up  additions.  Should  death  occur  during 
the  ten  years  in  which  additional  premiums  were 
being  paid,  only  the  face  of  the  policy  plus  any 
accumulations  or  additions  would  be  paid. 

This  option  is  most  valuable  as  a  talking  point. 


CHAPTER  VII 


ANNUITIES 


The  Massachusetts  Mutual  issues  three  kinds  of 
Annuities;  Immediate  Life,  Deferred,  and  Joint  Life 
and  Survivor.  The  following  analysis  of  these  forms 
wiU  aid : 

IMMEDIATE  LIFE 

1 .  This  form  guarantees  a  payment  to  the  annuitant 
as  long  as  he  (or  she)  is  alive.  ' 

2.  The  premium  for  this  income  is  a  single  cash 
payment  due  immediately.  The  cost  of  this  Im- 
mediate Annuity  depends  upon  the  age  and  sex  of  the 
annuitant  at  the  date  of  purchase.     See  rate  book. 

3.  The  Company  must  have  evidence  of  age  before 
the  contract  can  be  issued. 

4.  The  income  under  this  form  will  begin  as 
provided  in  the  contract.  If  the  sum  is  to  be  paid  the 
annuitant  annually,  then  the  first  payment  will  be 
made  one  year  from  the  date  of  issue.  If  semi- 
annually, six  months  from  date  of  issue.  If  quarterly, 
three  months,  and  if  monthly,  one  month  thereafter. 

5.  The  last  payment  due  the  annuitant  is  the 
periodical  payment  immediately  preceding  his  (or  her) 
death. 

6.  This  form  does  not  participate  in  the  surplus  of 
the  Company. 

7.  No  cask  or  loan  values  are  granted. 


62  MASSACHUSETTS   MUTUAL   TEXTBOOK 

8.  No  refund  in  event  of  death. 

9.  A  special  form  of  application  is  required,  but  no 
medical  examination  is  necessary. 

DEFERRED 

1.  A  deferred  annuity  provides  an  income  for  the 
annuitant  beginning  at  the  end  of  a  given  period,  or 
on  the  anniversary  of  the  contract  after  attaining 
a  stipulated  age,  and  continuing  as  long  thereafter 
as  he  (or  she)  lives. 

2.  Premiums  are  payable  for  the  number  of  years 
the  annuity  is  deferred,  and  the  rate  varies  with  the 
age  at  purchase,  the  sex,  and  the  plan.  There  are 
two  plans  of  deferred  annuities,  one  with  premiums 
returned  in  event  of  the  death  of  the  annuitant  before 
attaining  the  end  of  the  deferred  period,  the  other  with- 
out return  of  premiums.  See  pamphlet  giving  rates, 
etc. 

3.  On  default  in  payment  of  any  premium  the 
deferred  annuity  will  become  paid-up  for  such  pro- 
portion of  the  full  amount  as  the  number  of  premiums 
paid  bears  to  the  number  required  by  the  contract. 

4.  At  the  time  when  the  first  regular  annuity 
payment  would  fall  due,  a  cash  value  is  available  and 
may  be  taken  in  place  of  the  annuity  payments.  See 
rate  book. 

5.  This  form  of  annuity  participates  in  the  surplus 
of  the  Company  until  the  first  regular  payment  of  the 
annuity  falls  due. 

6.  Special  form  of  application  is  necessary,  but  no 
medical  examination  is  required. 


ANNUITIES  63 

7.  A  deferred  annuity,  upon  payment  of  an  extra 
premium,  can  be  added  to  an  Endowment  policy  as  old 
age  protection. 

JOINT  LIFE  AND  SURVIVOR 

1 .  Payment  of  an  annuity  under  this  plan  is  made 
during  the  joint  lifetime  and  to  the  survivor  of  two 
lives.  Payments  are  made  under  the  same  conditions 
as  apply  to  a  single  life  annuity. 

2.  Premiums  for  such  forms  depend  upon  the  age 
and  sex  of  the  annuitants  at  date  of  purchase.  Rates 
can  be  obtained  at  Home  Office. 

3.  Evidence  of  age  of  each  anuitant  must  be 
furnished  before  contract  can  be  issued. 

4.  This  form  does  not  share  in  the  surplus  of  the 
Company. 

5.  This  form  has  no  loan  or  cash  value. 

6.  No  medical  examination  of  either  party  re- 
quired, but  a  regular  annuity  application  is  required  in 
each  case.  •? 

SOME  BENEFITS  UNDER  ANNXnTIES 

(a)  It  appeals  to  men  and  women  of  ample  means 
who  do  not  wish  to  be  troubled  with  investments  and 
re-investments. 

(b)  It  provides  a  larger  income  than  could  be 
obtained  elsewhere  with  equal  security. 

(c)  It  frees  one  from  anxious  care — no  worry  in  old 
age. 

(d)  It  enables  a  parent  to  care  for  child,  making 


64       MASSACHUSETTS  MUTUAL  TEXTBOOK 

income  sure  from  date  of  issue  (or  otherwise)  through 
life. 

(e)  The  deferred  plan  calls  for  less  immediate 
outlay  and  so  is  within  the  reach  of  the  average  man 
or  woman. 


CHAPTER  VIII 


CONTINUOUS   MONTHLY   INCOME 

This  form  of  policy  is  very  popular  with  insurants. 
On  the  Life  or  the  Limited  plan  it  provides  for  a 
monthly  payment  by  the  Company  beginning  at  the 
death  of  the  insured  and  continuing  during  the  entire 
lifetime  of  the  beneficiary. 

On  the  Endowment  plan  this  form  provides  for 
a  monthly  payment  by  the  Company  beginning  at  the 
end  of  the  endowment  period,  and  continuing  during 
the  life  of  the  insured  and  thereafter  during  the  life  of 
the  beneficiary  named  in  the  application,  if  said  bene- 
ficiary survives  the  insured;  or  beginning  at  the 
death  of  the  insured,  if  this  occurs  during  the  endow- 
ment period,  and  continuing  during  the  life  of  the  bene- 
ficiary. 

These  policies  are  issued  to  provide  for  ten  years 
certain  or  for  twenty  years  certain, — that  is,  for  120 
or  240  stipulated  monthly  payments. 

Under  both  Life  and  Endowment  policies  on  the 
Continuous  Income  plan,  no  payments  beyond  the  stip- 
ulated payments  shall  be  made  except  to  an  original 
beneficiary.  Any  substituted  beneficiary  shall  partici- 
pate in  payments  only  until  the  end  of  the  stipulated 
period. 

Once  a  year  the  beneficiary  under  this  Continuous 
Monthly  Income  policy  will  receive  an  interest  dividend 
check  in  addition  to  the  regular  monthly  payment. 

This  form  of  policy  takes  the  place  of  an  executor — 
relieves  the  beneficiary  from  the  worry  of  investment 
— the  monthly  payment  is  certain,  continuous,  and 
cannot  be  diverted — the  principal  cannot  be  wasted  or 
squandered  by  some  untrustworthy  administrator — 
in  every  way,  this  form  must  commend  itself  to 
insurers.     Talk  income! 


CHAPTER  IX 


INSTALLMENT   OPTIONS 
GENERAL  SUGGESTIONS 

Remember  tha,t  all  policies  issued  by  the  Massa- 
chusetts Mutwal  contain  installment  option  privileges, 
except  policies  on  the  Continuous  Income  Plan, 

Talk  income  for  wife  or  children  to  your  prospect 
instead  of  life  insurance. 

Give  every  case  special  consideration  according  to 
its  needs. 

An  Ordinary  or  Limited  Payment  Life  policy  with 
installment  options  can  be  made  to  fit  most  conditions 
better  than  the  Monthly  Income  plan. 

Do  not  forget  the  interest  item  on  deferred  payments 
— important! 

Keep  in  mind  the  annual  interest  dividend  paid 
under  Options  B  and  C  in  addition  to  the  installments. 

The  Company  will  consider  the  payment  of  the 
proceeds  of  a  policy  in  many  ways  not  specified  in  the 
policy.  Any  unusual  beneficial  clause  should  be 
first  submitted  to  the  Company  for  approval. 

The  installments  cati  be  arranged  to  cover  the  lives 
of  two  persons — and  even  thfet — under  Option  B  or  D. 

SPECIFrC  SUGGESTIONS 
OPTION  A 

Under  this  option  the  beneficiary  may  be  provided 
with  a  fixed  income  for  a  number  of  years  or  months, 


INSTALLMENT   OPTIO.NS  67 

the  number  depending  upon  the  amount  of  income 
chosen  and  on  the  rate  of  interest  credited  by  the 
Company  on  the  annual  balance  of  the  installment 
fund  remaining  in  its  possession. 

The  installment  includes  the  full  amount  of  interest 
credited — no  further  interest  payments  would  be 
made. 

At  3%  interest  $2,000  would  provide  $50  a  month  for 
42  months. 

At  4^%  interest  $10,000  would  provide  $50  per 
month  for  thirty-one  years  and  ten  months,  or  $100  per 
month  for  126  months. 

By  changing  the  amount  of  monthly  income  or  the 
duration  of  the  income  on  old  and  new  insurance,  an 
excellent  argument  for  increasing  an  individual's 
holdings  can  be  made,  a  great  variety  of  combinations 
being  possible. 

Among  the  many  possible  benefits  to  be  obtained 
under  this  option,  only  four  will  be  mentioned.  They 
are  as  follows : 

(a)  Proceeds  of  the  insurance  payable  to  mother 
in  20  annual  payments  of  $250  each,  and  balance  re- 
maining in  Company's  hands  as  a  21st  installment. 

(b)  Proceeds  of  the  policy  paid  to  brother  of  the 
insured  in  monthly  installments  of  $50  each  as 
trustee  for  the  benefit  of  insured's  daughter. 

(c)  Proceeds  of  the  insurance  paid  in  monthly 
installments  of  $40  to  wife  of  the  insured — she  being 
granted  privilege  of  increasing  the  installment  to  an 
amount  not  in  excess  of  $100  per  month. 

(d)  From  the  proceeds  of  the  policy  an  initial 
payment  of  $250  to  the  insured's  wife — and  from  the 


68  MASSACHUSETTS   MUTUAL   TEXTBOOK 

balance  a  monthly  income  of  $25  to  be  paid  wife.  If 
she  should  die  before  the  proceeds  are  exhausted, 
monthly  installments  are  to  be  continued  to  each  of 
the  insured's  daughters  equally  or  to  the  survivor, — 
the  monthly  income  to  be  reduced  to 


Option  A  affords  a  great  variety  of  combinations 
for  the  protection  of  wife,  children,  and  the  insured  in 
old  age.  For  additional  suggestions  write  Actuarial 
Department. 

OPTION  B 

Under  this  option  the  beneficiary  receives  a  definite 
amount  for  a  definite  period  of  time. 

Interest  dividends  are  drawn  by  way  of  extra  pay- 
ments at  the  end  of  each  year  and  may  be  considered  as 
a  bonus.  They  grow  less  as  the  proceeds  of  the  policy 
out  of  which  the  income  is  paid  are  reduced  each  year 
by  payments  to  the  beneficiary, — as  the  proceeds 
grow  less  the  interest  earned  thereon  decreases.  See 
table  in  Dividend  Schedule  furnished  by  the  Com- 
pany. 

Five  thousand,  five  hundred  eighty  dollars  of  insurance 
will  give  the  beneficiary  $100  per  month  ior  five  years 
— with  a  dividend  each  year. 

Twenty-three  thousand  nine  hundred  dollars  of 
insurance  will  give  the  beneficiary  $100  per  month  for 
30  years — and  dividends. 

An  initial  payment  of  a  larger  amount  can  be 
provided  by  adding  the  amount  of  such  payment  to 
the  equivalent  insurance  value  of  income  desired. 

Ten  thousand  dollars  of  insurance  will  provide 
a  monthly  income  for  the  beneficiary  of  $96.17  for 
ten  years — or  $41.85  for  30  years. 


INSTALLMENT   OPTIONS  69 

Among  the  many  benefits  to  be  obtained  under  this 
option,  four  will  be  mentioned.     They  are  as  follows: 

(a)  Proceeds  of  the  insurance  to  be  payable,  in 
event  of  the  death  of  the  insured,  to  wife  if  living,  in 
240  monthly  installments. 

{h)  From  proceeds  of  the  insurance  an  initial 
payment  to  wife  of  $1,000,  the  balance  oi.  proceeds  in 
240  monthly  installments  of  $50  each,  tho.  first  monthly 
payment  to  be  made  on  the  first  day  of  the  month 
next  succeeding  the  payment  of  $1,000. 

(c)  The  proceeds  of  the  insurance  to  be  payable  to 
wife  as  trustee  for  son,  in  annual  installments  as  pro- 
vided under  Option  B — number  of  annual  installments 
to  be  determined  by  subtracting  from  21  the  age  of  the 
said  beneficiary  at  the  time  policy  becomes  a  claim. 
If  the  son  shall  have  attained  the  age  of  21  proceeds 
of  policy  shall  be  paid  him  in  one  sum. 

{d)  Proceeds  of  insurance  to  be  payable  in  240 
monthly  installments  of  $100  each  to  executors  for  the 
equal  benefit  of  children,  the  share  of  any  beneficiary 
dying  leaving  issue  to  be  paid  equally  for  the  benefit 
of  such  issue,  and  if  any  of  children  decease  leaving 
no  issue,  his  or  her  share  of  the  proceeds  of  this  policy 
to  revert  to  the  equal  benefit  of  such  of  the  insured's 
children  as  may  then  be  alive. 

Under  this  option  there  are  many  possible  arrange- 
ments for  protecting  wife,  children,  grandchildren,  and 
one's  old  age.  Consult  the  Actuarial  Department  for 
further  information. 

OPTION  C 

Under  this  option,  the  beneficiary  receives  a  life 
income  as  long  as  such  beneficiary  may  live,  with  the 
added  guarantee  that  in  any  event  payments  will  be 


70  MASSACHUSETTS  MUTUAL  TEXTBOOK 

made  for  a  stated  number  of  years.  Complete  protec- 
tion may  be  furnished  the  pohcyholder  or  the  benefi- 
ciary. 

Interest  dividends  are  drawn  by  way  of  extra  pay- 
ments at  the  end  of  each  year,  decreasing  as  under 
Option  B. 

$25,467  would  be  sufficient  to  provide  a  wife  with 
$100  a  month  for  life,  twenty  years  guaranteed,  if  she 
was  35  years,  old  when  her  husband,  the  insured,  died. 


),000  would  provide  $43.80  per  month  for  life, 
ten  years  guaranteed,  if  completed  age  of  beneficiary  is 
40. 

The  guaranteed  income  payments  under  this  option, 
tn  any  event  will  give  a  substantial  return  on  account 
of  the  policy.  If  the  beneficiary  die  soon  after  com- 
mencing to  receive  the  income,  no  large  loss  of  the 
proceeds  will  result. 

On  an  Endowment  policy,  or  by  the  cash  surrender 
value  of  a  life  policy,  the  insured  has  an  opportunity 
of  securing  an  old  age  pension  for  himself. 

This.option  can  be  changed  to  fit  changing  conditions 
without  affecting  the  face  of  the  policy.  In  this 
regard  it  has  a  greater  practical  value  than  the 
Continuous  Monthly  Income  plan,  under  which  there 
is  no  income  option  available  other  than  that  stipulated 
in  the  contract.  Dividends  and  cash  values  under 
Option  C  are  relatively  larger  than  under  Continuous 
Monthly  Income  plan. 

Among  the  many  benefits  to  be  obtained  under  this 
option,  we  will  mention  three: 

(a)  The  proceeds  of  the  insurance  to  be  payable 
as  provided  in  Option  C,  20  installments  stipulated, 


INSTALLMENT  OPTIONS  71 

payments  to  be  made  monthly  to  Jane  Doe,  bom 


wife  of  the  insured,  if  living;  otherwise  to  Mary  Doe, 
mother  of  the  insured,  or  to  said  mother's  heirs-at-law. 
The  right  to  change  and  to  successively  change  the 
beneficial  interest  without  the  consent  of  the  benefi- 
ciary is  reserved  to  the  insured. 

(6)  The  proceeds  of  the  insurance  to  be  payable  at 
maturity  as  an  endowment  to  the  insured  in  annual 
installments,  15  guaranteed,  as  provided  in  Option 
C,  any  unpaid  installments  to  be  payable  to  the  insured's 
daughters  Mary  and  Lucy  equally  or  to  the  survivor 
of  them.  In  the  event  of  the  insured's  death  prior  to 
the  expiration  of  the  endowment  period  the  proceeds 
to  be  payable  in  similar  manner  to  the  insured's 
daughters  Mary  and  Lucy  equally  or  to  the  survivor. 

(c)  Make  the  proceeds  of  the  insurance  payable, 
in  the  event  of  the  insured's  death,  as  provided  in 
Option  C,  twenty-five  installments  stipulated,  to  the 
insured's  wife  Mary  Doe,  born  ,  if  living,  other- 
wise as  provided  in  the  Installment  Option  provisions 
— said  payments  to  be  made  monthly  at  the  rate  of 
$8.45  per  month  for  each  $100  of  annual  installments 
as  provided  herein. 

Option  C  can  be  modified  to  suit  the  needs  of 
individual  cases  or  to  meet  changing  conditions. 
There  are  hardly  any  circumstances  in  practice  where 
some  adaptation  of  this  option  would  not  provide 
what  was  wanted.  It  is  regarded  by  all  who  are 
familiar  with  its  possibilities  as  the  greatest  of  Options. 

OPTION  D 

Under  this  option  the  proceeds  of  the  insurance  are 
left  with  the  Company,  and  interest  thereon  at  not  less 
than  three  per  cent  is  paid  the  beneficiary.  The 
Company  further  contracts  to  pay  such  additional 
rate  as  the  Directors  may  determine. 


72  MASSACHUSETTS    MUTUAL   TEXTBOOK 

The  Company  is  primarily  a  life  insurance  corpora- 
tion, whose  chief  purpose  is  to  pay  claims,  but  the 
oflEicers  believe  it  to  be  within  the  Company's 
province  to  see,  as  far  as  possible,  that  the  proceeds  of 
our  policies  are  used  to  the  best  advantage  of  the 
beneficiaries. 

The  Company  holds  the  money,  not  as  a  trust  fund 
and  to  be  administered  as  such,  but  only  with  the  idea 
that  it  shall  be  used  in  some  more  definite  manner 
sooner  or  later.  The  Company  does  not  wish  to 
accumulate  funds  under  this  option. 

Under  this  option,  no  re-investment  of  the  fund  held 
by  the  Company  is  required — no  legal  expense  is 
necessary  in  collecting  the  income — no  direct  invest- 
ment expense  in  the  form  of  brokerage — no  deprecia- 
tion in  the  value  of  the  proceeds — and  the^  full  amount 
of  the  sum  insured  can  be  realized  at  any  time,  if 
proper  provision  is  made. 

Upon  the  death  of  the  original  beneficiary,  the 
interest  income  under  this  option  can  be  continued  to 
a  second  beneficiary,  or  even  to  a  third  if  such  was 
horn  before  the  death  of  the  second  beneficiary. 

Among  the  benefits  to  be  secured  under  this  option, 
three  are  mentioned  as  follows : 

(a)  Proceeds  retained  by  Company,  interest  paid 
monthly  to  insured's  wife  during  her  lifetime — at  her 
death,  or  should  she  not  survive  the  insured,  proceeds 
paid  in  240  monthly  installments  as  provided  under 
Option  B  to  insured's  daughters  Mary  and  Jane 
equally  or  to  survivor.  If  neither  daughter  is  alive  at 
death  of  wife,  proceeds  are  to  be  paid  to  her  estate. 
If  neither  daughters  nor  wife  are  alive  at  his  death, 
proceeds  are  to  be  paid  to  his  estate 


INSTALLMENT   OPTIONS  73 

(b)  Proceeds  to  be  paid  under  Option  D — interest 
installments  to  wife  during  her  lifetime — at  her  death 
the  installments  to  be  continued  to  insured's  daughters 
Mary  and  Jane,  equally,  until  they  respectively  attain 
the  age  of  25,  at  which  time  the  share  of  each  daughter 
attaining  said  age  to  be  paid  her  in  annual  installments, 
25  stipulated,  as  provided  under  Option  C.  In  event 
of  death  of  either  or  both  of  said  daughters,  prior  to 
death  of  insured's  wife,  such  deceased  daughter's 
share  to  be  paid  in  one  sum  to  her  executor  for  equal 
benefit  of  any  surviving  issue,  and  if  there  be  no 
surviving  issue,  then  to  the  executor  of  the  deceased 
daughter. 

(c)  Proceeds  of  the  policy  to  be  payable  as  provided 
in  Option  D,  as  follows:  The  income  from  the  sum 
insured  shall  be  payable  in  monthly  installments 
beginning  one  year  from  the  receipt  of  due  proof  of 
death  of  the  insured,  and  shall  be  paid  to  the  wife  of 
the  insured,  if  living  when  said  installments  fall  due, 
otherwise  to  Thomas,  son  of  the  insured,  if  then  living, 
otherwise  to  the  children  of  the  said  Thomas,  if  any 
are  then  living,  otherwise  to  Jane,  the  daughter  of  the 
insured;  it  being  the  intention  that  said  beneficiaries 
shall  successively  receive  said  income  during  their 
respective  lives  in  the  order  in  which  they  are  herein 
named.  If  all  of  such  beneficiaries  predecease  the 
insured  the  principal  sum  shall  be  paid  to  the  executors 
or  administrators  of  the  said  insured. 

The  principal  advantages  of  Option  D  afforded  the 
beneficiary  are  the  security,  good  rate  of  interest, 
freedom  from  worry,  and  flexibility  in  the  use  of  the 
proceeds  of  the  insurance  left  with  the  Company. 

For  more  elaborate  explanation  of  Installment 
Options,  you  are  referred  to  papers  and  articles  in  the 
Radiator  published  in  1917.  Those  are  both  instruc- 
tive and  exhaustive. 


CHAPTER  X 


A  FEW   TALKING   POINTS   OF   VALUE 

The  following  tips  have  been  gathered  from  the 
wide  experience  of  our  best  solicitors  and  will  prove 
helpful  to  the  beginner  in  selling  our  policies, — he  will 
thus  have  a  great  advantage  over  the  one  who  was 
never  told. 

1 .  Should  the  applicant  pay  the  first  premium  at 
the  time  he  makes  application,  as  soon  as  the  Com- 
pany approves  same,  he  is  protected  from  the  date 
of  the  medical  examination,  whatever  his  condition  of 
health  may  be  when  policy  is  delivered.  A  strong 
point  to  use  for  getting  check  with  application.  Try 
to  get  check  with  every  application. 

2.  An  applicant  can  pay  a  quarterly  (or  semi- 
annual) premium  in  advance,  and  when  the  next 
quarterly  comes  due,  can  pay  four  quarterly  premiums 
in  advance,  the  Company  discounting  these  to  an 
annual  rate  at  the  age  policy  was  issued.  If  the 
insured  continues  so  to  pay  these  premiums  until 
death  or  maturity,  the  quarterly  premium  paid  in 
advance,  not  due  by  the  terms  of  the  policy,  will  he 
returned. 

By  this  process  he  can  many  times  adjust  the 
payment  of  his  annual  premium  to  the  day  and  month 
desired — retain  his  age  and  not  use  the  preliminary 
term. 

3.  A  policyholder  can  pay  in  advance  as  many 
premiums  as  he  desires.  The  Company  will  discount 
these  premiums  so  advanced  at  simple  interest,  giving 


A  FEW  TALKING   POINTS    OF  VALUE  75 

the  insured  an  agreement  that,  in  event  of  his  death 
the  then  present  worth  of  premiums  not  yet  due  will  be 
returned  with  the  face  of  the  policy. 

4.  Should  a  policyholder  make  a  loan  from  the 
Company  on  his  policy,  no  time  is  set  for  him  to  pay  it 
back.  The  Company  will  accept  partial  payments, 
stopping  interest  upon  each  one  as  it  is  made.  Interest 
on  the  loan  is  not  collected  in  advance,  unless  the  entire 
cash  value  is  borrowed.  Read  the  loan  clause  in  the 
policy.  Do -not  emphasize  the  loan  feature.  Every 
loan  made  lessens  the  protection  intended  by  the  face 
of  the  policy. 

5.  One  can  take  an  Ordinary  Life  policy,  carry  it 
while  needing  protection  for  his  family,  and  then 
under  any  of  the  options  use  the  cash  value  to  secure 
a  monthly  income  for  his  old  age.  Strong  talking 
point — especially  with  large  policies. 

6.  A  proof  of  death  consists  of  claimant's  statement, 
physician's  and  undertaker's  certificates.  Very  simple. 
No  "Friend's  statement"  required.  Emphasize  this. 
Good  plan  to  show  proof. 

7.  When  the  accumulated  surplus  on  an  Ordinary 
Life  policy  (or  any  other),  added  to  the  reserve, 
equals  the  face  of  the  policy,  the  Company  will  pay 
the  full  face  of  such  a  policy.  In  that  case,  the  insured 
doesn't  have  to  ''die  to  win."  All  policy  forms  that 
may  become  endowments  to  the  holder  late  in  life  are 
worthy  of  much  study. 

8.  Study  the  change  of  an  Ordinary  Life  to  a 
Limited  Payment  Life.  For  example, — after  five 
years'  premiums  have  been  paid  and  dividends  have 
been  used  to  reduce  premiums,  find  from  the  table 
in  your  rate  book  what  one  dollar  would  amount  to 
at  6  per  cent  compound  interest  for  five  years.     Then 


76  MASSACHUSETTS    MUTUAL   TEXTBOOK 

multiply  that  amount  by  the  difference  in  premiums 
between  the  two  policies.  This  will  give  you  the 
approximate  amount.  Then  tell  your  prospect  who 
is  "not  ready"  to  take  a  Twenty  Payment  Life  that  he 
can  take  a  lower  premium  policy  and  change  it  over 
later  to  the  kind  desired — no  loss  of  time,  money,  or 
age.     Fine  closing  argument. 

9.  A  man  wants  to  endow  his  own  old  age,  and 
care  for  a  daughter  at  the  same  time.  Endowment  on 
two  lives-  is  the  greatest  thing,  ever.  Monthly  income 
sure — no  worry- — no  executor — nobody's  business.  When 
policy  matures,  he  gets  a  check  every  month  and  an 
annual  dividend ;  and  when  he  dies,  she  gets  a  check  for 
the  same  amount  every  month  and  an  annual  interest 
dividend  as  long  as  she  lives.  This  can  be  worked  out 
in  other  ways. 

10.  When  a  person  dies,  the  state  (and  possibly 
the  National  Government)  will  collect  from  his  estate 
an  inheritance  tax.  An  Ordinary  Life  policy  suffi- 
ciently large  to  cover  this  tax,  allowing  dividends  to 
remain  with  the  Company,  makes  a  fine  talking  point. 
A  prudent  ma.n  likes  to  provide  his  estate  with  every 
protection. 

11.  Emphasize  the  advantage  of  a  Nineteen  Pay- 
ment Life,  especially  if  your  prospect  has  an  idea  that 
he  wants  a  Twenty  Payment  Life.  But  little  difference 
in  premiums, — cash  values  larger, — dividends  greater, 
— aggregate  cost  lower,  paid-up  sooner  if  dividends 
are  allowed  to  accumulate — mature  as  an  endowment 
sooner  if  dividends  are  left  with  the  Company.  Great 
policy  to  talk  when  a  competing  company's  Twenty 
Payment  Life  rate  is  no  smaller. 

12.  The  savings  bank  feature  of  all  Endowment 
policies  shoiild  be  accentuated.  Money  deposited 
with  the  Company,  same  as  with  a  bank,  with  the 


A  FEW  TALKING    POINTS   OF  VALUE  77 

added  advantage  of  death  benefit — asset  for  old  age — 
Company  will  pay  proceeds  of  policy  in  monthly 
installments — nobody's  business — no  fees  to  pay — no 
worry  about  daily  bread. 

13.  He  has  a  mortgage  {death  grip)  on  his  home. 
He  hesitates  about  insuring,  fearful  he  cannot  pay  the 
premium  on  either  a  Twenty  Payment  Life  or  an 
Ordinary  Life.  He  has  about  all  he  can  do  to  support 
his  family  and  pay  the  taxes.  Suggest  a  Term  policy 
while  his  burdens  are  so  very  heavy.  It  protects  his 
loved  ones,,  and  sa,ves  his  rate.  Probably  within 
five  years  he  can  change  it  to  a  better  plan. 

14.  Co-partnership — insurance  payable  when 
partner  dies,  prevents  hasty  search  for  another  partner 
— vexatious  intrusion  by  obstinate  executor — un- 
pleasant pressure  of  creditors — forced  sale  to  raise 
money  to  buy  out  dead  partner's  interest — stoppage 
of  credit.  At  such  times,  life  insurance  transforms 
itself  into  a  banker  to  pay  debts — an  investor  to  buy 
new  goods — a  sales  manager  who  is  not  deterred  from 
selling  the  stock — and  everybody  rejoices.  Great 
talking  point. 

Term  policies  are  well  calculated  to  protect  business 
interests,  loans  at  banks,  unusual  financial  risks  for 
short  periods,  etc. 

There  are  many  other  excellent  features  of  our 
policies  that  will  spring  up  in  your  fertile  brain  and  bear 
rich  fruitage  as  you  go  about  your  daily  work. 


CHAPTER  XI 


SALESMANSHIP 

GENERAL 

In  the  broad  range  of  commercial  activity,  expert 
salesmanship  takes  precedence  over  all  other  branches. 
The  successful  salesman  is  admired  by  all.  In  these 
wonderful  days,  he  is  abroad  in  the  land.  Selling  life 
insurance  is  a  fine  art,  calling  for  the  highest  type  of 
manhood,  backed  by  the  largest  degree  of  efficiency. 
As  a  vocation  it  knows  no  creeds,  no  boundary  lines, 
no  impossibilities. 

Old  forms  of  drumming  and  drinking  to  sell  our  goods 
have  been  thrown  on  the  scrap  heap,  to  make  way  for 
greatly  improved,  high-class  professional  methods. 
Since  the  essential  steps  in  every  sale,  by  all  authori- 
ties, consist  in  enlisting  attention — arousing  interest — 
awakening  desire— obtaining  decision  and  securing 
action,  the  life  agent  becomes  more  than  a  salesman  of 
merchandise — more  than  a  mere  salesman  of  policies. 
In  his  work  he  acts  a  varied  role.  He  gives  valuable 
advice — acts  as  a  friend — serves  as  a  banker,  trustee, 
attorney,  or  judge  for  every  one  he  solicits.  The  extra 
qualities  of  head  and  heart  employed  in  so  versatile 
an  occupation  give  the  business  a  delightful  flavor 
peculiarly  its  own. 

Any  man  of  average  ability,  by  earnest  work  and 
strength  of  character,  can  secure  in  the  life  insurance 
business  a  satisfactory  income  and  an  imperishable 
place  in  the  community.  To  engage  in  this  work, 
one  does  not  need  to  have  money,  a  strong  pull,  or 
a  university  education;  but  he  will  need  to  energize 
his  brains — he  will  need  to  bring  into  constant  action 


SALESMANSHIP  79 

all  the  affections  of  the  heart — not  less  must  he  preserve 
and  conserve  his  health,  because  good  health  is  both 
forceful  and  magnetic.  His  growth  in  power,  skill, 
wealth,  influence,  and  happiness  will  be  in  proportion 
to  the  degree  with  which  he  uses  these  faculties. 
Every  successful  salesman  of  policies  in  the  Massa- 
chusetts Mutual  Life  Insurance  Company  may  have 
the  assurance  that  he  can  take  his  place  in  the  social 
and  economic  life  of  the  section  where  he  lives — no 
one  should  rank  above  him.  He  can  assuredly  feel 
and  confidently  express  the  dignity  of  the  great  business 
in  which  he  is  engaged,  because  of  its  beneficent  and 
remedial  effect  upon  his  neighbors.  He  can  cherish 
the  feeling  that  he  has  diagnosed  big  commercial  affairs 
and  guarded  them  from  death-  destroying  consequences 
by  proper  indemnity.  His  heart  should  get  big  when 
he  reflects  what  crimes  he  has  prevented, — what  poor 
houses  he  has  closed, — what  institutions  of  learning  he 
has  endowed, — what  hospitals  he  has  equipped, — and  so 
on.  Verily  the  salesman  of  Massachusetts  Mutual 
policies  has  the  right  to  stand  erect  and  glory  in  his 
work. 

PRACTICAL 

In  a  more  practical  presentation  of  life  insurance 
salesmanship,  and  by  way  of  a  good  foundation,  let  us 
consider  briefly  the  policy  or  the  article  we  are  to  sell, 
the  customer  or  the  one  induced  to  buy,  and  the  sales- 
man or  the  one  who  solicits  the  business  and  makes 
the  sale. 

THE  POUCY 

Massachusetts  Mutual  policies  are  clearly  written 
— easily  understood- — generous  in  their  terms — cover 
every  condition  of  human  need — one  price  to  all  and 
at  a  low  net  cost — proceeds  paid  when  due — have 
never  been  repudiated,  have  never  been  conjectural  or 
contained  an  element  of  loss  to  the  holder — up  to  the 
minute  in  conditions,  options,  and  benefits, — are  very 
popular    wherever    known, — praised    by    our    com- 


80       MASSACHUSETTS  MUTUAL  TEXTBOOK 

petitors, — approved  by  the  Insurance  Departments 
of  the  various  states — honored  by  the  daily  press — 
commended  by  thousands  of  beneficiaries — and  in  all 
respects  without  a  superior. 

Various  kinds  of  policies  issued  by  the  Company 
are  listed  under  another  heading. 

The  Massachusetts  Mutual  as  an  institution  has 
always  been  devoted  to  the  service  of  policyholders  and 
beneficiaries.  The  purpose  of  its  founders  was  to 
make  its  policy  contracts  fit  the  needs  of  policyholders 

in  every  way. 

THE  CUSTOMER 

Here  is  the  material  on  which  we  work.  Every 
person  who  is  eligible  for  insurance  is  a  possible 
customer.  By  "eligible"  is  meant  one  who  is  able  to 
pay  the  premium,  and  who  measures  up  to  the  Com- 
pany's standard  of  insurability,  and  in  whose  life  some- 
body has  an  insurable  interest.  Every  such  customer 
should  have  some  insurance,  more  insurance,  or  better 
insurance — "better"  than  the  quasi  insurance  offered 
by  assessment  companies.  No  two  customers  are  exactly 
alike.  They  differ  is  so  many  ways,  it  would  be  impossi- 
ble to  mention  them.  But  these  various  differences 
furnish  a  diversified  and  interesting  experience  much 
more  enjoyable  than  otherwise.  The  number  of  cus- 
tomers is  rapidly  increasing,  which  is  an  earnest  that  the 
field  will  never  be  exhausted.  Each  generation  offers 
new  opportunities  for  the  salesman  with  the  need  of  pro- 
tection greatly  emphasized.  This  is  due  to  the  growth 
in  population  and  wealth — the  widespread  educational 
processes  at  work  through  institutions  of  learning, 
general  advertising,  the  public  press,  and  field  work 
done  by  thousands  of  solicitors — and  the  disbursement 
of  millions  of  dollars  in  dividends,  cash  values,  and 
death  and  endowment  claims  by  the  companies  doing 
business.     But  our  customers  do  not  "come  in"  to 


SALESMANSHIP  81 

buy  insurance  as  they  would  groceries  or  clothing — 
not  as  a  rule. 

Because — 

1.  They  are  careless  or  too  engrossed  in  their 
personal  affairs  and  so  delay. 

2.  They  hate  to  buy  something  which  they  think 
will  yield  a  return  only  after  they  are  dead. 

3.  They  are  too  hard  up  and  prefer  to  wait  for 
a  "more  convenient  season." 

4.  They  do  not  fully  appreciate  how  much  they 
need  insurance — nor  the  danger  in  delay.     So — 

They  must  be  selected,  interviewed,  interested,  and 
persuaded.  Work  of  this  kind  is  the  "beau  ideal"  of 
salesmanship — and  to  this  end  each  solicitor  is 
earnestly  striving.  He  aims  to  be  versatile  enough  to 
handle  successfully  the  brusque,  square-jawed,  deter- 
mined person  as  easily  as  ^e  does  the  high-browed 
thinker  who  reasons  everything  out.  He  studies  to  be 
flexible  enough  to  deal  successfully  with  the  lacka- 
daisical, devil-may-care  fellow  who  does  or  does  not 
care  for  protection  (depends  on  the  weather  vane) ,  and 
considers  it  not  too  hard  to  solicit  the  ignorant,  bigoted 
chap  who  has  to  be  educated  before  he  is  written.  He 
must  study  character,  environment,  family,  wealth,  and 
many  other  customer-determining  factors.  Customer 
study  is  the  greatest  topic  in  our  business.  How  to 
secure  prospects,  methods  of  interviewing,  how  best 
to  interest  them  in  our  policies,  and  ways  and  means 
of  closing,  will  be  briefly  discussed  under  the  topic  of 
"Selling." 

THE  SALESMAN 

The  one  who  brings  policy  and  customer  together. 
He  must  know  the  policy — he  must  know  the  customer. 


82      MASSACHUSETTS  MUTUAL  TEXTBOOK 

Knowing  the  policy  is  comparatively  easy — but 
learning  the  customer  is  difficult,- — the  most  difficult 
of  all  his  work.  The  salesman  must  have  brains 
enough  to  keep  all  his  senses  alert — must  have  a  body 
well  enough  and  strong  enough  to  make  itself  felt — 
must  have  a  heart  big  enough  and  kind  enough  to 
convert  buyers  into  friends.  Or,  in  other  words,  he 
must  have  average  ability,  great  endurance,  a  disposition 
to  work  and  a  good  moral  character.  These  qualities 
are  easily  trained,  if  the  salesman  only  will.  Under 
proper  environments  and  careful  cultivation  their 
growth  is  rapid.  There  is  a  great  variety  of  life 
insurance  salesmen.  We  can  characterize  a  few  of 
them  as  follows:  big  ones,  little  ones — faithful  ones, 
false  ones — enthusiastic  ones,  indifferent  ones — up- 
right ones,  untrustworthy  ones — and  we  might  go  on. 
Each  earnest  salesman  can  elect  himself  to  any  class 
he  desires,  in  spite  of  outside  influences.  In  other 
words,  he  is,  in  a  great  measure,  the  architect  of  his 
own  future  and  so  can  build  well  or  otherwise.  Study, 
observation,  and  work,  backed  by  a  praiseworthy 
ambition,  will  make  a  first-class  insurance  man  out  of 
him.  The  ideals  he  must  choose — how  best  to  inform 
himself  on  plans  and  methods — what  to  see  and  hear 
as  he  labors — approved  and  well-tried  schedules, 
projects,  and  suggestions  about  field  work,  are  referred 
to  more  in  detail  under  "Selling." 


CHAPTER  Xn 


SELLING 


Under  this  heading,  we  will  outline  the  actual 
securing  of  applications,  dividing  the  subject  for 
convenience  into  the  following  headings: 

I.  Preparation. 

II.  Means  of  Increasing  Acquaintance. 

III.  Prospects — Where  Found —  How  Found. 

TV.  Some  Methods  of  Approach. 

V.  Suggestions  About  Closing. 

VI.  Following  Up. 

VII.  Practical  Suggestions. 

PREPARATION 

TWENTY-FIVE  SUGGESTIONS 

1.  Keep    yourself    clean    and    well    dressed.     The 

impression  you  make  may  tip  the  scales  in  your 
favor;  besides,  it  increases  your  own  self- 
respect. 

2.  Free  your  mind  absolutely  from  any  other  business 

or  professional  cares.  Yom  can't  do  two  or 
three  things  successfully  at  the  same  time. 
Read  your  contract  with  your  General  Agent 
— keep  your  promises. 


84  MASSACHUSETTS   MUTUAL  TEXTBOOK 

3.  Read  your  Book  of  Instructions  provided  by  the 

Company  and  then  obey  orders.  It  is  the  only 
way  to  avoid  asking  foolish  questions.  It  is 
the  quickest  and  surest  way  to  leain  the 
Company's  wishes. 

4.  Study    the  forms    of   policies    and    the    circulars, 

literature,  etc.,  published  by  the  Company.  The 
Ordinary  Life,  Twenty  Payment  Life,  and 
Twenty  Year  Endowment  policies  first,  then 
other  forms  as  you  grow  more  into  the  business. 

5.  The  Rate  Book  needs  a  lot  of  attention.     This  book 

belongs  to  the  Company — it  is  simply  loaned 
to  you.  It  contains  rates,  values,  tables,  and 
other  matter  of  great  value  to  you  in  your  field 
work.  You  can  study  this  for  many  years  and 
still  find  something  new  and  helpful.  It  can't 
be  exhausted. 

6.  As  you  get  farther  into  the  work,  read  every  book 

and  pamphlet  on  field  work  you  can  secure. 
Every  suggestion  from  successful  men  or 
methods  will  enable  you  to  sell  more  Massa- 
chusetts Mutual  policies.  And  read  them  over 
and  over  again. 

7.  Secure  a  copy  of  the  Massachusetts  law  relating  to 

life  insurance  companies  chartered  by  that 
commonwealth,  and  read  it.  You  will  then 
better  understand  its  equitable  provisions  for 
the  policyholder,  and  more  fully  realize  the 
many  safeguards  which  surround  Massa- 
chusetts companies  for  the  policyholder's 
protection.     It  is  referred  to  elsewhere. 

8.  Learn  a  little  (not  too  much)   about  other  com- 

panies with  which  you  may  sometime  have  to 
compete.  As  their  forms  of  policies,  rates,  and 
values  are  constantly  changing,  it  will  hardly 


SELLING  85 

be  necessary  to  study  them  in  too  minute 
detail.  But,  always  have  books  at  your 
command  from  which  you  can  get  up-to-date 
information.     This  is  very  important. 

9.  Be  the  Massachusetts  Mutual's  champion  and 
safeguard  its  interests  under  every  circumstance. 
You  are  an  integral  factor  in  this  great 
corporation.  Fidelity  to  the  trust  reposed  in, 
you  by  the  Company  is  most  assuredly  expected. 
You  have  a  right  to  be  the  proudest  individual 
who  carries  a  rate  book. 

10.  The  "party  of  the  first  part" — to  your  contract — 

the  Manager  or  General  Agent  in  charge — is 
entitled  to  your  loyal  support.  Give  it  to 
him  freely,  cheerfully.     He  will  reciprocate. 

11.  Your  relation  to  those  you  insure.     Get  a  clear 

conception  of  what  you  are  to  them.  They 
are  to  be  instructed,  guided,  assisted,  and 
befriended  in  every  way.  This  is  most  im- 
portant.     Never  let  go  your  hold  on  them. 

12.  Close    your   ears   to    the    "siren   songs"    of  those 

representatives  of  other  companies  who  would 
lure  you  away.  If  you  changed,  some  other 
company  might  induce  you  to  make  another 
change  and  so  on — spelling  Death.  No!  Stay 
by— build  up  your  reputation.  You  will  never 
be  sorry. 

13.  Set  your  mind,  your  will„  your  heart,  upon  becoming 

a  successful  salesman  of  the  Massachusetts 
Mutual's  policies,  if  it  takes  you  ten  years  to  do 
it.  Never  mind  ordeals,  trials,  losses,  dis- 
appointments— they  will  make  you  stronger, 
surer — and  success  sweeter.  Many  have  done 
it— you  can.     Be  determined. 


86  MASSACHUSETTS   MUTUAL  TEXTBOOK 

14.  Study  continually  only  those  methods  and  plans 

that  will  give  you  greater  inspiration  and  make 
you  more  efficient.  Inspiration  and  efficiency 
mean  income  and  happiness.  Our  own 
Radiator  and  other  insurance  journals  are  full 
of  suggestions  and  plans  that  have  been 
successfully  tried  out.  Try  'em  yourself. 
Write  out  your  own  successes.  Write  'em 
over  again  and  so  on. 

15.  Shun  drink,   gambling,   profanity,   and  anything 

else  that  would  besmirch  your  character.  As  you 
are  the  exponent  of  the  Company,  a  debauched 
life  could  hardly  be  called  a  proper  representa- 
tion. 

16.  Speak  well  oj  your  competitors.     It  pays  to  see 

the  good  in  others  and,  if  called  on,  to  mention 
it.  Especially  say  nice  things  about  them  to 
the  man  you  are  soliciting,  should  you  find  it 
necessary  to  mention  them  at  all. 

17.  Keep    your    head    clear,    your    blood    in    proper 

circulation,  and  your  digestion  perfect.  Else 
you  cannot  be  vigorous,  buoyant,  forceful,  mag- 
netic.    Guard  your  health  with  jealous  care. 

18.  The  Company's  field  force  have  an  association 

called  the  "Agents'  Association  of  the  Massa- 
chusetts Mutual  Life  Insurance  Company," 
which  holds  one  session  annually  at  the  Home 
Office  in  Springfield.  It  will  pay  you  to  join 
the  Association,  attend  those  meetings,  and 
take  part  in  the  proceedings. 

19.  //    there    is    a    Life     Underwriters'    Associaiion 

organized  near  where  you  live,  join  it.  Mix. 
Touch  elbows.  Exchange  ideas  and  secure  the 
benefits  of  organized  co-ordinated  team  work. 


SELLING  87 

20.     Systematize  your  work  by  a  card  index  or  other- 


wise. 


21.  Be  thorough.     Take  great  pains  with  whatever 

you  undertake.  Study  to  do  more  than  is 
expected  and  do  it  better.  Study  to  do  your 
work  more  quickly  than  is  expected,  and  to 
keep  doing  business  at  the  old  stand  longer. 
So  will  you  become  more  efficient. 

22.  Look  and  work  for  big  applications — but  do  not 

pass  a  small  one. 

23.  Never  acknowledge  defeat — rather  say,  "He  won't 

do  it  now,  but  I  will  get  him  yet." 

24.  Never  misuse  social,   club,   or  lodge  privileges. 

Use  your  acquaintance  only  to  enlarge  it. 

25.  Don't  scatter  in  your  work.     Never  skim  a  place 

— a  factory — a  wholesale  house — a  big  depart- 
ment store — a  village — a  city  block — a  town- 
ship— work  each  to  the  bottom. 


CHAPTER  XIII 


MEANS  OF  INCREASING  ACQUAINTANCE 

A  large  acquaintance  is  the  only  foundation  for 
extensive  and  effective  work  in  selling  insurance.  It 
isn't  to  be  accomplished  in  a  week,  or  a  month,  but 
rather  a  desired  end  to  be  worked  towards — a  purpose. 
To  be  well  acquainted  is  also  essential.  How  best  to 
meet  the  best  persons  in  a  community  is  the  problem. 
The  following  suggestions  may  be  helpful : 

MIX 

I.  You  must,  if  you  wish  to  "get  next."  No  hermit 
ever  accomplished  anything,  anyhow,  anywhere, 
any  time.  You  must  get  into  the  social  and  business 
life  and  know  men  and  women.  Join  some  secret 
society  of  your  liking,  the  Club,  the  Chamber  of 
Commerce,  the  Guild,  etc.  And  when  you  become 
a  member,  attend  the  meetings,  social  functions, — 
meet  the  members  and  keep  meeting  them  until  you 
know  them  and  a  lot  about  them,  and  they  know  you. 
You  will  soon  possess  a  fine  stock  of  valuable 
information  and  a  fine  group  of  acquaintances — 
most  valuable  assets. 

INVEST 

II.  Buy  a  share  or  two  in  the  local  bank — the 
creamery — the  manufacturing  plant — or  any  other 
corporation  made  up  of  the  best  men  in  your  location. 
Buy  it,  if  you  have  to  borrow  the  money.  And  then 
attend  stockholders'  meetings  and  so  get  acquainted. 
One  of  our  best  producers  gets  his  best  business  from 
the   stockholders   in   the   companies   where   he   has 


MEANS  OF  INCREASING  ACQUAINTANCE  89 

invested  small  sums.  It  took  him  several  years  to  do 
this,  but  now  he  belongs  to  a  dozen  corporations  and 
knows  nearly  every  stockholder.  Take  your  time 
but  do  it. 


TALK  ABOUT  SOMETHING  ELSE 

III.  Your  introduction  would  be  practically  worthless 
if  you  "boned"  a  man  for  an  interview  the  first  time 
you  met  him  at  a  social  or  business  function.  One 
of  the  best  ways  to  win  a  man's  respect  is  to  talk 
with  him  about  things  of  public  or  mutual  interest — 
and  talk  intelligently.  Good  manners  and  brains 
will  make  you  a  larger  and  better  acquaintance,  if 
properly  used,  than  everlastingly  harping  on  insurance 
whenever  you  meet  a  man.  Meet  him  halfway  on 
whatever  may  be  of  interest  to  him  without  boring 
him.  The  opportunity  will  come  for  you  to  present 
your  proposition.  Pbssibly  you  can  tell  him  some- 
thing that  will  be  of  value  to  'him.  Be  on  the  look- 
out.    Big  business  is  frequently  secured  this  way. 

INTRODUCTION  BY  POLICYHOLDER  OR  EXAMINER 

IV.  This  is  a  valuable  method  of  enlarging  your 
circle  of  acquaintances.  This  is  not  to  be  done 
wholesale — but  a  little  at  a  time — whenever  op- 
portunity offers.  Men  whom  you  have  insured 
right  will  help  you  to  get  acquainted  with  other 
good  men.  Much  depends  upon  how  you  do  your 
work,  if  you  expect  cooperation.  You  won't  insure 
all  you  meet,  but  properly  introduced,  each  one 
will  pass  you  on  to  his  friend,  who  may  prove  to  be 
a  prospect 

PROMISCUOUS  CANVASSING 

V.  Among  those  nearest  you — wherever  you  feel 
inclined  to  go.  By  this  method  you  will  need  to 
make    your   business    known   when   you    enter   his 


90  MASSACHUSETTS  MUTUAL  TEXTBOOK 

oflEice,  shop,  or  home.  A  straight  canvass,  while  not 
yielding  such  large  results  as  some  other  methods, 
will  open  up  a  vast  field  of  possible  acquaintance  and 
among  good  men,  if  you  choose  to  seek  them  and  are 
able  to  secure  an  interview  with  them.  This 
method  of  getting  acquainted  is  arduous  and  sub- 
jected to  many  disappointments.     It  is  not  the  best. 


CHAPTER  XIV 


PROSPECTS— WHERE  FOUND— HOW  FOUND 

In  considering  this  subject,  let  us  first  define 
a  prospect.  To  a  man  who  writes  $50,000  of  new 
business  per  annum,  a  "prospect"  is  a  person  with 
whom  he  has  had  two  or  more  interviews  and  who  seems 
interested.  To  the  one  who  writes  $250,000  per  annum 
a  "prospect"  is  anyone  who  will  give  him  a  respectful 
hearing.  To  the  one  who  writes  $1,000,000  or  more 
per  annum  a  "prospect"  for  insurance  is  a  person  who 
can  pass  the  regular  medical  examination,  can  pay  the 
required  premium,  who  hasn't  alt  the  insurance  he 
ought  to  carry,  and  in  whose  life  some  one  or  something 
has  an  insurable  interest.  Salesmanship  transforms 
such  a  one  into  an  applicant. 

Now,  among  what  classes  of  individuals  will  you  be 
most  likely  to  find  the  best  prospects — and  how  will 
you  proceed  to  do  so? 

THE  MOST  LIKELY  CLASSES 

I.  (a)  Young  men  and  maidens — from  fifteen  to 
twenty  years  of  age — through  their  parents.  Brief 
reasons:  to  get  early  start, — low  cost, — while  in 
good  health, — if  Endowment  is  taken  it  matures 
early, — Limited  Life  policies  paid-up  while  insured 
is  still  young, — in  case  of  early,  untimely  death, 
parents  reimbursed  for  money  spent  in  education, 
training,  care,  etc.  A  wonderful  field  and  worthy 
the  most  careful  cultivation. 

{b)  Women.  Widows  with  dependent  children,  wives 
whose    husbands    are    uninsurable, — single    women 


92  MASSACHUSETTS   MUTUAL  TEXTBOOK 

wlio  hold  remunerative  positions  like  stenographers, 
clerks,  saleswomen,  school-teachers,  artists,  doctors, 
nurses,  lawyers,  women  of  wealth  or  in  business  with 
large  responsibilities,  etc.  Brief  reasons:  care  for 
old  age, — protect  a  loved  one, — secure  an  investment, 
save  money, — safeguard  estate  or  business,  etc. 
With  a  large  and  increasing  number  of  women  who 
are  wage  earners  or  in  business  for  themselves,  the 
scope  of  possibilities  among  this  class  is  unlimited. 
Some  of  the  best  solicitors  the  life  companies  have 
are  women  themselves.  They  have  added  tone  and 
character  to  the  business. 

(c)  Young  Men  Starting  for  Themselves.  Those 
graduating  from  college  or  soon  to  graduate, — just 
going  into  business, — entering  religious  work, — com- 
mencing practice  of  law  or  medicine,  etc.  College 
men  in  groups  or  classes  for  benefit  of  college  or 
fraternity, — members  of  religious  bodies  in  groups  to 
secure  a  mortgage,  etc.  Brief  reasons:  forces  saving 
and  stimulates  thrift  and  economy, — best  form  of 
collateral, — policy  well  under  way  when  he  marries, 
— rates  low, — increases  his  self-respect,— inWy  paid- 
up  in  his  prime,  etc.  Opportunity  for  business 
among  these  classes  of  young  men  is  tremendous. 

{d)  Business  and  Professional  Men.  Merchants, 
manufacturers,  bankers,  lawyers,  physicians,  finan- 
ciers, capitalists,- — big  men  of  every  calling  every- 
where. Such  men  are  frequently  easiest  to  handle 
and  very  satisfactory  persons  with  whom  to  do 
business.  Our  best  salesmen,  who  place  a  half 
million  or  more  a  year,  work  chiefly  among  this 
class.  Brief  reasons:  creates  an  immediate  estate, 
— many  times  does  away  with  need  of  an  executor, — 
gives  additional  security  to  creditors, — perpetuates 
a  father's  care  by  monthly  income  through  one  or 
two  generations, — protects  sacred  interests, — endows 
colleges  and  other  institutions, — takes /mwc^s  out  of 


PROSPECTS — WHERE  FOUND — HOW  FOUND         93 

speculations, — pays  inheritance  and  other  taxes 
imposed  at  death, — endows  old  age,  etc.  Perhaps 
the  greatest  possibilities  in  all  your  field  are  to  be 
found  in  this  class.  Men  herein  constitute  the 
keenest,  most  experienced,  most  rational,  most  able 
of  all.  It  is  a  great  pleasure  to  do  business  with 
them. 

(e)  Farmers — Artisans — etc.  Thrifty  farmers  who 
read  the  papers,  and  skilled  mechanics  who  get  good 
wages.  Protection  for  loved  ones  and  other  usual 
arguments.  These  men  are  usually  thoughtful  and 
reasonable.  Policies  will  not  be  large  in  this  class, 
but  they  will  stick.  In  case  of  mechanics,  see  book 
of  instructions. 

(/)  Partnership  and  Business.  Joint  Life  payable 
to  survivor,  an  official's  life  to  preserve  business  in 
case  of  death, — on  heads  of  departments,  employes 
in  banks,  etc.  A  wide  territory  for  intensive  work. 
Brief  reasons:  one's  knowledge,  connections,  ^nd 
good  will  are  hard  to  replace, — capital  might  be 
withdrawn  from  business, — creditors  become  uneasy, 
— perpetuates  the  earning  power  of  the  deceased, — 
valuable  collateral  when  more  capital  is  desired, — 
protects  endorsers, — buys  out  a  retiring  partner's 
interest, — prevents  disruption  or  disorganization  of 
business. 

HOW  TO  FIND  THEM 

2.  (c)  Read  the  Daily  Papers — for  information  about 
those  with  whom  you  are  acquainted.  You  should 
note  promotions  with  increased  salaries — announce- 
ments of  engagements  or  marriages — persons  coming 
suddenly  into  wealth  because  some  relative  died — 
death  of  a  citizen  whose  son  you  know — rich  men 
or  women  you  know  elsewhere  moving  into  your 
town — graduates  from  local  colleges  or  schools — 
lawyers  who  have  won  notable  cases — doctors  who 
have    performed    great    operations,    etc.     All    such 


.94       MASSACHUSETTS  MUTUAL  TEXTBOOK 

information  helps  you  convert  an  acquaintance  into 
a  prospect.     Get  after  them  quickly,  don't  wait! 

(b)  Those  already  Insured  in  the  Company.  They 
know  the  value  of  insurance  or  they  never  would 
carry  it — -they  have  once  been  accepted,  so  will 
likely  pass  again — they  believe  in  our  Company,  and 
are  undoubtedly  satisfied  with  the  treatment 
received — you  know  their  ages  and  occupations — 
when  their  rate  changes,  when  they  pay  a  premium, 
just  after  recovering  from  a  successful  operation  or 
a  fit  of  sickness  which  would  not  make  them  unin- 
surable— when  a  baby  is  born,  etc.  Among  those 
you  or  your  predecessors  have  insured  will  be  found 
a  most  fertile  field.  Especially  is  this  true  with  the 
Massachusetts  Mutual,  in  which  every  policyholder 
is  so  well  pleased.  Many  young  men  and  women 
have  proven  good  prospects  to  the  salesman  for 
policy  after  policy  as  they  grew  older.  Watch  out 
and  let  none  of  them  be  seduced  into  another  com- 
pany while  you  sleep.  Remember,  if  sold  right, 
your  policyholders  become  your  best  customers. 

(c)  Through  Help  from  Old  Policyholders.  When 
a  person  is  pleased  with  your  treatment — and  the 
Company's  treatment — even  if  fully  insured  himself 
— he  will  be  very  glad  to  boost  your  business.  He 
will,  if  properly  coached,  be  on  the  lookout  for 
prospects  for  you,  and  will  locate  many  you  would 
otherwise  never  have  known.  Properly  insured  and 
trained,  every  one  you  have  written  should  furnish 
you  at  least  ten  good  prospects  per  year — both 
among  people  you  know  and  those  you  have  never 
met.  Work  this  out.  No  other  source  of  securing 
prospects,  especially  for  big  business,  compares  with 
this.  Write  them  occasionally  very  briefly  thank- 
ing them  for  past  favors  and  suggesting  that  they 
don't  forget  you.  Just  a  few  words.  See  ''Follow- 
ing   Up."     An  autograph  book — in  which  each  one 


PROSPECTS — WHERE   FOUND — HOW  FOUND  95 

you  have  insured  writes  a  word  of  praise  for  the 
Company  and  tells  what  he  has  done — over  his  sig- 
nature. Great!  Can't  get  them  all  to  sign,  but 
you  can  secure  enough  to  make  the  book  very  help- 
ful— letters  of  recommendation  serve  the  same  pur- 
pose. 


{d)  Use  of  Company's  Circulars  and  Pamphlets. 
Take  notice  that  all  literature  furnished  by  the 
Company  is  merely  an  aid,  and  is  not  in  any  sense 
to  take  the  place  of  a  personal  interview — nothing 
will.  Know  every  circular  the  Company  provides. 
Never  send  any  one  an  unmarked  leaflet.  Blue 
pencil  some  one  clause  you  desire  to  have  read  and 
he  will  probably  read  it — not  otherwise.  Don't 
swamp  any  one  with  circulars.  Kill  your  chances, 
sure!  When  sending  out  these  leaflets  have  careful 
regard  to  age,  sex,  business,  financial  conditions, 
etc.  And  remember  that  circulars  followed  up  with 
a  personal  call  lead  to  prospects — they  don't  bring 
them  to  you  except  in  very  rare  instances.  Sending 
circulars  as  a  general  practice  is  a  poor  way  to  get 
prospects. 

(e)  Special  Occasions.  When  you  pay  an  Endow- 
ment or  death  claim,  it  becomes  a  wonderful  pros- 
pect-getter if  used  correctly.  The  man  himself 
(if  an  Endowment),  the  widow,  a  brother,  a  sister, 
a  son,  an  employe,  a  partner,  the  nurse,  the  under- 
taker, the  doctor,  etc.  Wonderful!  Then  birthdays 
can  be  used  to  great  advantage — wedding  anniver- 
saries, business  anniversaries,  birth  of  a  baby  (keep 
a  list  of  babies  and  dates  of  birth  and  send  some 
little  token  each  year) — payment  of  dividends  both 
when  the  insured  is  paying  renewal  and  after  a  policy 
is  paid-up.  Payment  of  yearly  installments  (or 
monthly)  to  beneficiaries — all  such  times  and 
occasions  should  be  prolific  in  prospects. 


96  MASSACHUSETTS    MUTUAL   TEXTBOOK 

(/)  Straight  Canvass.  By  this  is  meant  soliciting 
without  introduction  or  other  preliminary  assistance. 
Such  work  is  more  nerve-trying  and  demands  far 
more  skill  than  any  other  method,  but,  if  done 
properly,  some  splendid  results  may  be  secured  and 
the  solicitor  attain  a  high  degree  of  efficiency.  A 
few  suggestions  may  help : 

1.  Find  out  everything  you  possibly  can  about 
the  person  before  you  seek  the  interview.  Get 
information  about  his  family,  home,  politics, 
religion,  business,  wealth,  insurance,  health,  etc. 
Everything  you  can  find  out.     Be  prepared. 

2.  See  that  you  yourself  are  prepared.  Be  clean- 
shaven— well  dressed — shoes  polished — senses 
alert — stout  hearted. 

3.  You  must  get  into  his  office,  or  presence.  Unless 
guarded  by  secretary,  clerk,  or  other  person,  walk 
in.  If  necessary  to  send  in  card,  send  it,  but 
write  some  little  catch  phrase  that  he  will  surely 
see.  For  example :  "  Have  a  business  proposition 
to  make  you,  will  take  five  minutes."  "  Your 
daughter  needs  what  my  company  furnishes." 
"Life  is  uncertain  but  my  goods  unfailing." 
Very  many  others — use  your  capital  in  brains. 

4.  If  shown  in,'  don't  enter  like  a  trespasser  or  a  man 
out  on  parole.  Be  bold  (but  not  too  bold), 
pleasant,  polite  always.  Sit  near  him.  Don't 
begin  by  asking  him  a  lot  of  questions.  You 
should  know  his  age  and  a  good  deal  more.  You 
can  get  what  else  you  want  later  in  the  interview. 
Put  a  clear,  definite  proposition  before  him,  on 
a  tablet — so  you  will  interest  both  eye  and  ear. 
Say  nothing  about  cost  until  he  asks  about  it. 
Now,  listen,  you  are  there  to  interest  him — to 
sell  him.  Don't  let  him  put  you  off, — insist  on 
his  immediate  action  for  a  dozen  reasons,  but  do 


PROSPECTS — WHERE    FOUND — HOW   FOUND  97 

it  SO  winsomely — so  graciously — he  cannot  take 
offense.  Any  agent  who  can  walk  into  a  man's 
office  and  sell  him  a  policy  of  life  insurance  on  the 
first  interview  is  a  prince  of  salesmen. 

SUGGESTIVE 

Among  productive  fields  of  work  by  the  straight 
canvass,  the  following  tips  will  be  helpful: 

Overheard  conversation  on  street  car  or  elsewhere. 

Table  talk  at  some  function  or  cafe. 

Lists  of  members  of  exclusive  clubs. 

Farmers  who  have  had  good  crops. 

Society  news. 

Year  books  of  private  schools  for  boys  and  girls 
whose  parents  might  consider  income  insurance. 

Lists  of  property  owners,  especially  large  tax 
payers. 

Lists  of  5cAoo/- teachers. 

Those y«5/  elected  to  office. 

Physicians  jM5f  appointed  to  positions  in  hospitals, 
etc. 

News  of  employes,  promotions,  newcomers. 

Trade  and  other  journals. 

Every  solicitor  should  have  a  definite  object — fixed 
purpose — every  working  hour.  Go  somewhere  to  see 
some  one  who  looks  likely.  Never  remain  idle  a  minute. 
So  will  you  develop  personal  poise  and  skill  in  dealing 
with  them. 


CHAPTER  XV 


APPROACHING  THE  KNOWN 

Under  this  topic  we  will  refer  briefly  to  the  times  and 
methods  of  bringing  up  the  subject  of  his  insuring. 

There's  a  fitness  in  this  work.  There  are  occasions 
when  the  subject  will  suggest  itself.  There  is  a 
psychological  moment  when  mind  and  heart  are 
receptive.  There  are  methods  which  if  properly 
employed  will  put  one  in  a  receptive  mood.  Each 
case  requires  careful  study.  The  idea  is  to  secure  the 
application  with  the  least  resistance. 

OPPORTUNE  TIMES 

Supposing  you  know  him  and  he  appears  like  a  good 
risk  and  able  to  pay  the  premium : 

(a)  When  his  heart  is  full  of  love  for  his  dear  ones 
— you  can  tell. 

(b)  After    attending    the   funeral    of    a  friend — you 
might  possibly  be  there,  too. 

(c)  When  his  bank  has  asked  him  for  a  little  additional 
collateral  and  he  tells  you. 

(d)  When  you  have  been  able  to  do  him  a  kindness 
and  he  thanks  you  heartily. 

(e)  When  he  is  acting  as  the  executor  of  the  will  of 
a  friend. 

(/)     One  day  when  you  lunch  together  and  he  asks 
you  about  your  business. 


APPROACHING   THE    KNOWN  99 

(g)  When  he  has  a  narrow  escape  from  a  serious 
accident. 

(A)  When  you  have  just  paid  a  death  loss  to  the  widow 
of  a  friend  of  his. 

If  you  are  wide-awake  and  your  senses  alert  you  will 
not  lack  for  opportunities.  They  appear  every  day 
to  the  solicitor  with  the  "Open  Vision" — if  he  is  on 
the  job. 

SOME  METHODS— (UNDER   PRECEDING   CONDITIONS) 

(a)  "I  greatly  admire  you  for  loving  your  family. 
Bill,  but  have  you  thought  about  their  care,  if  you 
were  suddenly  taken?"  This  will  open  the  (question 
for  discussion. 

(b)  "Do  you  know,  John,  I  was  thinking  of  you 
while  the  friends  were  viewing  the  remains."  Just 
after  the  funeral  his  heart  will  be  receptive. 

(c)  "I  had  a  friend  who  used  his  policy  as  collateral 
at  a  bank.  Maybe  you  could  do  so,  too,  if  you  had 
one."     Will  enable  you  to  press  the  matter. 

(d)  "That's  all  right,  my  boy,  you  needn't  thank  me 
for  the  little  courtesy  shown  you.  Just  protect 
that  little  daughter  of  yours  against  her  papa's 
untimely  death.  That  will  be  thanks  enough  for 
me." 

(e)  "You  are  closing  up  Henry's  affairs,  aren't  you, 
Joe?  Well,  how  about  your  own?  Have  you  made 
your  will?  Why  not  let  our  Company  take  care  of 
your  family?"  (It  can  be  done  under  our  Con- 
tinuous Monthly  Income  policy  or  under  the 
Installment  Option  Provisions.) — While  he  is  finish- 
ing his  work  as  executor. 


100  MASSACHUSETTS   MUTUAL  TEXTBOOK 

(/)  "Yes,  Charlie,  business  is  good.  I  wrote  two 
applications  yesterday.  I  could  do  more.  You 
haven't  done  your  duty  yet,  old  man.  Why  not 
to-day?" — While  at  lunch. 

(g)  "If  that  automobile  accident  you  were  in  doesn't 
make  you  realize  how  uncertain  human  life  is, 
George,  I  don't  know  what  will."  An  entering 
wedge  just  after  he  has  recovered. 

(h)  "Here's  a  photograph  of  a  check  I  just  handed 
Jennie  Brown.  You  know  Jennie.  Well,  Arthur 
is  dead,  but  he  was  a  wise  boy  and  protected  his 
wife."  He  will  think  about  himself  and  his  wife, 
and — there  you  are. 

Once  more  study  men  and  the  events  and  things  that 
move  them.  The  study  of  men  will  yield  larger  returns 
than  the  study  of  methods  or  theories. 


CHAPTER  XVI 


APPROACHING  THE  UNKNOWN 

Among  methods  of  approaching  those  you  do  not 
know,  let  me  offer  a  few  suggestions,  and  bear  in  mind 
they  are  epitomized  and  only  suggestive: 

1.  Hand  the  person  a  circular.  He  will  usually  say, 
"No,  thank  you!  Don't  want  any."  Reply:  "I 
haven't  called  expecting  to  protect  your  home  to- 
day, but  simply  to  ask  you  for  permission  to  put 
you  wise  to  our  recent  policy  in  ten  minutes  to- 
morrow at  noon.  I  am  too  busy  to-day.  I  am 
fully  aware  that  you  do  not  want  any  insurance 
now,  but  you  may  take  more  before  you  die  and 
I  want  you  to  know  a  little  something  about  our 
Company,  I  will  not  solicit  your  business,  if  you 
do  not  want  me  to,  but  it  will  do  you  no  harm  to 
see  my  goods,  and  it  may  mean  much  to  you  later 
on."     You  may  get  an  appointment. 

2.  Another:  "Beg  pardon,  sir,  but  I  am  representing 
one  of  the  greatest  institutions  in  the  world,  and 
while  I  know  you  have  some  of  my  goods  (I  have 
just  had  a  short  talk  with  Dr.  X),  I  want  very 
much  to  see  if  you  are  in  physical  condition  to  get 
more — supposing  you  want  it  after  we  have  deter- 
mined your  eligibility.  Here's  a  bottle,  please 
give  me  a  little  specimen.  I  will  have  a  micro- 
scopical examination  made  and  report  to  you 
to-morrow.  No  expense.  If  when  you  receive  my 
report  you  don't  want  anything  further  to  do  with 
me,  you  are  under  no  obligations."  With  big  men 
who  know  how  easily  kidney  and  other  diseases 
creep  into  the  system,  this  will  not  infrequently 
work. 


102  MASSACHUSETTS   MUTUAL   TEXTBOOK 

3.  "Is  this  Mr.  Jones?  Well,  my  name  is  Blank. 
I  have  a  draft  on  a  New  York  bank  which  I  wish  to 
have  cashed.  Dr.  B.  couldn't  leave  his  office  to 
accompany  me  to  your  bank,  so  I  could  not  be 
identified,  but  if  you  will  call  his  office  you  can 
assure  yourself  that  I  am  the  man  named  on  the 
draft.  I  will  wait.  Thank  you.  Before  I  go  let 
me  open  an  account  for  you  with  our  bank  in  Spring- 
field. I  mean,  let  me  give  your  widow  a  draft 
backed  by  our  entire  assets  that  will  be  good  when 
presented  for  payment  in  one  week  or  forty  years 
hence.  The  rest  will  be  up  to  you — and  it's  easy." 
Then  ask  him  for  an  interview. 

4.  "Am  I  addressing  Mr.  C?  Well,  my  name  is 
Blank.  I  understand  you  have  a  daughter  eight 
years  of  age.  As  the  representative  of  one  of  the 
oldest  financial  institutions  in  this  country,  I  am 
engaged  in  providing  a  fixed  monthly  income  for 
little  daughters  like  yours.  Several  of  your  neighbors 
have  already  made  such  arrangements.  I  would 
like  the  privilege  of  showing  you  my  plan." 

There  are  hundreds  of  other  methods  of  approaching 
strangers  in  a  straight  canvass,^ — but  space  forbids. 
This  much  can  be  said  however,  "The  proper  study  of 
mankind  is  man.''  If  the  solicitor  will  study  men 
more,  the  proper  approach  will  suggest  itself  to  his 
fertile  mind,  naturally,  suitably. 

Here's  a  straight  tip:  Many  a  wall  of  opposition  in 
front  of  a  man  looks  impregnable,  but  it's  made  by ' 
a  bunch  of  human  folks  just  like  us.  There's  many 
a  solicitor  for  the  Massachusetts  Mutual  who  would  be 
astounded  at  how  easily  he  could  drive  his  personality 
through  the  thickness  of  the  obstruction  in  his  path  to 
success,  if  he'd  only  get  over  being  afraid  of  a  thing  on 
account  of  its  size  and  get  a  square  look  at  its  quality. 


CHAPTER    XVII 


SUGGESTIONS  ABOUT  CLOSING 

Closing  a  person  consists  chiefly  in  overcoming 
objections  to  immediate  action.  By  closing  is  meant 
— getting  signature  to  the  application,  securing 
settlement  for  the  first  premium,  getting  the  person 
examined,  and  delivering  the  policy  when  issued. 
There  is  no  objection  or  argument  against  taking 
a  policy  now  but  that  can  be  honestly  answered  and 
successfully  refuted.  Not  all  of  these  objections  can 
be  considered  in  the  space  allotted,  but  suggestions 
will  be  made  that  will  prove  to  be  praiseworthy  if 
employed. 

Before  entering  into  details,  you  are  hereby  served 
with  six  injunctions: 

1.  In  all  your  soliciting,  tell  the  truth.  Lies  are 
unpleasant  bedfellows.  Honesty  is  the  best  policy, 
but,  if  it  isn't,  stick  to  it  just  the  same. 

2.  Sell  the  policy — not  the  Company,  not  an  investment, 
not  dividends — the  policy. 

3.  Talk  protection, — altogether,  everywhere. 

4.  Give  every  person  with  whom  you  do  business  a 
square  deal. 

5.  Talk  and  act  so  that  policyholders  and  others  will 

be  glad  to  see  you. 

6.  Talk  with  four  persons,  about  insuring,  each  day, — - 
PROMISE! 


104      MASSACHUSETTS  MUTUAL  TEXTBOOK 
"NOT  NOW" 

This  is  so  common  a  statement  from  one  with 
whom  you  have  labored  hard  to  insure,  that  it  might 
be  said,  "  You  can  expect  it  in  90  per  cent  of  all  cases." 

The  following  excuses  will  be  offered : 

1.  "7  am  not  ready" — perhaps  not,  but  when  you 
are  the  Company  might  not  want  you.  It  takes 
two  parties  to  make  a  contract  of  insurance.  Cite 
cases  of  men  both  of  you  know,  who  are  ready  but 
no  company  will  take  them..  What  do  you  mean  by 
ready?  You  certainly  can't  mean  you  are  now 
uninsurable,  you  seem  so  well,  but  are  you  sure? 
Let  the  doctor  look  you  over.  You  certainly  can't 
mean  you  are  not  financially  able,  because  the 
premiums  can  be  made  payable  to  suit  you.  You 
must  mean  you  haven't  made  up  your  mind  to  in- 
sure. Yes?  Then  the  protection  of  your  home  and 
the  dear  ones  is  a  whim,  a  sentiment,  a  mood,  an  emo- 
tion. Do  your  duty.  There  is  only  one  time  to 
do  one's  duty,  and  that  is  NOW! 

2.  "Must  wait  until  I  get  my  home  paid  for."  Then 
what?  You  are  older,  perhaps  uninsurable,  and 
the  time  that  you  make  the  last  payment  is  un- 
certain. Besides,  who  would  pay  for  it  if  you  died? 
Why  ask  your  wife  to  carry  the  risk?  Take  out 
a  policy  and  assign  part  of  it  to  the  man  who  holds 
the  mortgage  or  contract — so  relieve  your  wife. 
Nearly  every  man  who  dies  leaves  a  mortgage  or 
other  debts — but  most  of  them  make  provision. 

3.  "Have  enough  already."  Dare  say!  But  cost  of 
living  is  increasing — you  can't  tell  how  much  your 
last  sickness  will  cost, — your  wife's  income  after 
your  death  will  not  be  so  large  as  yours  now, — then 
your  creditors  must  be  considered,  cost  of  administer- 
ing your  estate,  etc.     What  you  now  have  invested 


SUGGESTIONS  ABOUT  CLOSING  105 

at  five  per  cent  less  income  tax  and  other  taxes — is 
it  much,  now  is  it?  Stop,  think!  You  can  add 
another  policy — why  not  NOW? 

4.  "Later  perhaps,  but  not  just  now,  my  wife  objects." 
So!  If  she  objected  to  your  buying  something  for  the 
children,  you  wouldn't  buy  it.  Your  wife's  objection 
doesn't  discharge  your  duty  to  her  or  the  children. 
Your  wife  doesn't  fully  understand  the  proposition, 
or  she  wouldn't  object.  Women  don't  view  things 
as  men  do.  If  she  were  sick  and  needed  a  doctor 
and  told  you  not  to  get  one,  would  you?  If  you  had 
a  policy,  and  should  die,  would  she  be  sorry  you 
didn't  let  her  tell  you  what  to  do? — would  she  use 
the  money?  Never  fear,  you  love  her  and  the 
children,— rfo  it  NOW! 

5.  "/  like  your  policy,  and  will  give  you  my  promise 
to  take  a  policy  when  I  get  ready."  Don't  do  it. 
You  always  keep  your  promises.  Now,  suppose 
/  held  you  to  it,  and  you  refused  to  do  business  with 
all  the  other  solicitors,  before  I  could  get  to  you,  and 
you  got  sick  or  died, — eh?  What's  the  use? 
NOW — while  you  can — is  the  only  time  to  keep 
your  promise.  No  better  company — no  better 
policy.  How  would  three  p.m.  do? — he  could 
examine  you  in  jif teen  minutes.     Thank  you! 

We  could  multiply  these  suggestive  methods  of 
closing  indejinitely,  but  must  leave  you  to  work  them 
out. 

The  following  objections  are  a  few  of  the  most 
common  ones  you  will  meet  in  your  work : 

"Never  was  in  better  health, — don't  need  it." 

"Want  to  take  a  big  policy  when  I  take  any." 

"I  am  in  sore  financial  straits." 


106  MASSACHUSETTS   MUTUAL  TEXTBOOK 

"I  have  no  children." 

"My  wife  has  money  of  her  own." 

"Have  all  I  can  possibly  carry." 

"It  costs  too  much." 

"My  business  takes  all  my  money." 

"I'll  carry  my  own  insurance." 

"See  me  after  January  1." 

"Can  put  my  money  to  better  use." 

"Suppose  the  Company /ai/^?" 

"I  won't  sign  a  note,  and  I  can't  spare  the  money 
now." 

"Expect  to  live  to  be  85.     Father  did." 

"Won't  leave  a  lot  of  money  for  my  wife's  second 
husband." 

"I  can  save  and  invest  my  money  as  well  as  the 
Company  can." 

"I  can  get  insurance  in  my  lodge  cheaper  than  your 
Company  can  furnish  it." 

"I  have  no  confidence  in  life  insurance  agents." 

"Suppose  my  wife  should  die  before  /  did?" 

"My  family  is  well  protected  by  investments." 

"Suppose  I  failed  to  pay  the  third  premium?" 


SUGGESTIONS  ABOUT  CLOSING  107 

"When  are  you  coming  around  again?" 

"Go  over  and  see  Jones,  if  he  does,  /  will." 

"I  am  a  member  of  the  United  Brethren  church." 

"Too  busy  to-day,  but  will  take  it  to-morrow." 

"Wait  until  I  gather  my  crops." 

"How  much  will  you  discount  the  first  year?" 

And  we  might  name  many  more  excuses.  Make  up 
your  mind  in  advance  to  hear  these  objections,  and 
don't  let  them  dampen  your  ardor.  Every  one  can  be 
refuted,  and  you  can  soon  learn  the  arguments. 


CHAPTER   XVIII 


FOLLOWING  UP 

Understand,  please,  this  does  not  mean  trailing  a 
man  as  a  hound  follows  his  quarry — before  you  secure 
his  application.  No!  Your  aw6i/iow,  your  desire  for 
commission,  your  pride  will  spur  you  on  to  secure 
business.  But  after  you  have  by  hard,  persistent, 
tactful  work  put  his  name  on  your  books,  what  then? 
Well,  several  things. 

1.  Drop  him  a  line — a  dozen  words — once  a  month; 
— enclose  a  calendar,  a  souvenir,  a  circular  marked. 
No  dawdling!  Be  businesslike  and  be  sure  that 
what  you  write  or  send  will  either  help  him  to 
understand  his  insurance  better  or  inure  to  his 
personal  advantage. 

2.  Call  on  him  about  every  sixty  days — when  you 
get  a  large  clientele  this  will  be  impossible.  Shake 
hands,  congratulate  him  on  his  health,  his  business, 
Kis  work,  his  new  baby,  the  size  of  his  dividend  just 
after  he  gets  his  renewal  notice,  his  crops,  etc.  Find 
something  to  say  that  will  make  his  heart  warm. 
Remember  that  all  the  world  likes  a  Jolly.  And 
don't  "bone"  him  for  additional  insurance  ez^cry  time 
you  call.  You  can  talk  and  act  so  that  he  will  bring 
up  the  subject.     There's  where  salesmanship  shines. 

3.  Tactful  courtesies  towards  him.  Not  only  to 
develop  loyalty  to  the  Massachusetts  Mutual,  because 
of  which  he  will  insure  in  our  Company,  but  to 
make  him  your  friend.  Invite  him  to  your  home — 
to  lunch — to  a  golf  game — a  fishing  trip — et  al. 
Get  under  his  waistcoat.     For  example:    An  agent 


FOLLOWING   UP  109 

of  another  company  called  one  of  our  solicitors  by 
phone  one  day.  This  is  what  he  said:  "I  under- 
stand that  Mr.  F.  is  going  to  place  a  large  line  of 
insurance.  Knowing  that  you  are  his  close  friend, 
I  thought  you  would  know  about  it  and  advise  me 
whether  I  had  better  call  on  him  or  not."  Our  agent 
replied  that  he  didn't  think  Mr.  F.  was  going  to 
insure,  but  he  could  call  upon  him  if  he  wanted  to 
and  he  didn't  need  to  have  permission  either.  He 
said,  "No!  I  could  not  do  anything  with  this  man 
without  your  co-operation."  See?  Our  agent  saw 
his  friend  a  few  days  later,  and  this  is  what  he  said 
after  he  had  related  the  circumstances:  "Do  you 
think  I  would  take  insurance  anywhere  else  in  the 
world  without  first  talking  with  you?  No,  indeed!" 
Our  genial  solicitor  had  been  enshrined  in  his  heart. 
He  ha.d  followed  him  up  right! 

Until  he  boosts  for  you.  By  a  process  of  suggest- 
ing, instructing,  and  training — a  little  at  a  time,  but 
none  the  less  sure — until  our  Company  is  engraved 
on  the  tablet  of  his  affections.  Until  Massachusetts 
Mutual  and  its  virtues  come  to  his  thought  and 
tongue  the  instant  any  one  says,  "Life  Insurance." 
He  will  send  his  son,  daughter,  brother,  sister,  and 
other  relatives  to  you — ready  to  insure.  He  wijl 
talk  to  his  friends  when  you  are  not  around,  will 
advertise  the  Company  more  effectually  than  some 
agents  can.  The  combined  support  of  one  hundred 
such  "boosters"  cannot  be  measured. 


CHAPTER  XIX 


PRACTICAL  SUGGESTIONS 

1.  Carry  a  list  of  prominent  policyholders  insured 
in  our  Company.  Sometimes  it  talks  louder  than 
anything  you  might  say.  Autograph  book  referred 
to  elsewhere  is  just  as  good. 

2.  In  many  states  a  discount  is  allowed  on  the 
inheritance  tax  if  it  is  paid  within  a  specified  time 
after  death,  or  an  interest  charge  is  made  if  it  is  not 
paid  within  a  certain  number  of  months.  Persons 
leaving  large  estates  can  avoid  the  sacrifice  of  valuable 
securities,  and  can  save  money,  by  insuring  so  as  to 
pay  such  taxes  promptly.  Great  talking  point  with 
rich  men.     Use  it. 

Complete  protection  can  be  secured  through  life 
insurance,  as  policies  payable  to  a  definite  beneficiary, 
instead  of  to  an  estate,  become  exempt  from  the 
operation  of  the  Federal  Inheritance  Tax  Law. 
Another  argument  which  can  be  forcibly  used  with 
people  of  means. 

3.  In  your  daily  work,  have  a  large  fund  of  illus- 
trations of  the  benefits  of  insurance,  the  folly  of  delay, 
the  uncertainty  of  good  health,  the  saving  in  early 
rates,  etc.  And  have  them  ready  to  use.  If  you 
haven't  any,  look  about  and  get  some, — the  busy  world 
is  full  of  them. 

4.  Many  applications  have  been  secured  by  getting  the 
prospect  to  let  the  Examiner  see  him  at  12  noon.  Have 
the  hlarik.  filled  out  as  completely  as  possible  from  data 
secured  elsewhere,  and  let  the  doctor  get  his  signature 


PRACTICAL    SUGGESTIONS  111 

when  he  examines  him.  Talk — "Can  you  pass?" — and 
press  it  home  hy' many  questions. 

5.  Deliver  all  your  talk  with  feeling.  Mean  it — 
put  life  into  it- — you  must  sustain  the  interest. 
Remember  you  are  a  business  man  discussing  a  matter 
of  vital  importance  with  another  business  man.  You 
lose  if  you  weaken,  stammer,  grow  pale,  or  get  nervous. 

6.  Monthly  income  for  wife  or  for  children  is  the 
opening  wedge  to  many  fine  applications.  The 
Massachusetts  MutuaVs  contract  duty  consists  quite 
as  much  in  caring  for  the  insured's  family  as  it  does  in 
paying  the  claim  promptly.  When  a  monthly  income 
is  properly  provided  under  our  options,  it  cannot  be 
commuted  or  collected  faster  than  authorized.  No 
lawyer  needed  to  interpret  benefits  and  secure  fees,  no 
executor  to  squander  proceeds,  no  need  of  seeking  safe 
investment  for  the  proceeds  of  the  policy,  no  loss 
through  ignorance  of  business  matters.  These  points 
can  be  elaborated,  and  they  seldom  fail  to  arouse 
keen  interest. 

7.  Be  on  the  lookout  for  corporations  with  valued 
officials  and  employees— or  co-partners  who  have 
large  interests  to  protect — dependent  upon  both — or 
business  men  who  depend  in  great  measure  upon  some 
one  employee. 

Commercial  life  insurance  furnishes  a  lucrative  field 
for  the  wide-awake  solicitor,  but  he  must  develop  it. 

8.  Be  resourceful.  Help  load  hay — tend  the  baby 
— assist  in  unpacking  goods — lend  a  hand  wherever 
and  whenever  you  can  to  assist  a  busy  or  needful  man 
or  woman.  You  will  be  surprised  at  their  willingness 
to  listen  to  you  when  you  present  your  proposition. 

9.  When  business  does  not  come  as  fast  as  you  wish, 
don't  blame  everybody  and  everything  but  yourself. 


112      MASSACHUSETTS  MUTUAL  TEXTBOOK 

There  are  plenty  of  excuses  that  answer  the  summons 
— paltry  excuses — but  don't  allow  yourself  to  use  them. 
Some  other  man  in  the  same  field  is  writing  twice  what 
you  are,  and  he  isn't  any  better  man  than  you,  only 
he  has  been  studying  himself  and  has  remedied  his 
weak  points  and  strengthened  his  strong  points. 
Self-analysis  is  what  you  need — and  a  lot  of  it.  You 
may  have  lacked  energy— system — tact- — imagina- 
tion— reason — courage.  Examine  your  failures  and 
compare  them  with  your  successes — and  then  correct 
them.     So  will  you  grow. 

10.  In  proportion  to  the  care  you  give  the  bene- 
ficiaries under  policies  you  have  placed,  maturing  by 
limitation  (if  Endowments)  or  death,  will  you  ap- 
preciate the  greatness  of  your  work  and  increase  your 
influence  for  good.  Help  them  with  proofs — take 
drafts  to  them — advise  them  about  the  use  of  the 
money,  etc.  Make  yourself  useful- — large  returns, 
not  only  in  new  business,  but  also  in  the  great  joy 
which  comes  from  real  service. 

11.  Settlements — when  the  application  is  written — 
just  after  the  examiner  has  passed  favorably  upon  the 
applicant — when  the  policy  is  ready  for  delivery. 
Best  time  is  when  application  is  written— best  form  of 
settlement  cash — best  amount,  full  annual  premium. 
Here's  where  the  rub  comes.  A  man  isn't  sold  life 
insurance  until  the  salesman  gets  the  settlement. 
Don't  get  "balled  up"  with  a  lot  of  notes — get  cash. 
A  ''Not  Taken"  policy  hurts  your  record. 

12.  Don't  appeal  to  friendship,  charity,  lodge,  church, 
club,  or  any  other  motive  or  connection.  Be  inde- 
pendent. Use  all  of  these  and  more,  but  never  as 
a  favor  or  plea  for  business.  These  are  to  widen  and 
strengthen  your  acquaintance.  When  you  reach  the 
personal  appeal  for  business,  put  it  on  its  merits, — the 
individual's    need    and    the    superior    quality    of    the 


PRACTICAL    SUGGESTIONS  113 

Massachusetts  Mutual' s  contract.  These  are  enough 
to  make  every  sale. 

13.  Never  allow  yourself  to  recount  your  failures 
with  groans  which  cannot  be  uttered.  Don't  get 
fussed  up  because  some  one  turned  you  down.  There's 
a  law  of  average  in  soliciting.  Out  of  a  given  number 
of  prospects  one  is  bound  to  make  some  sales.  If  you 
call  on  but  two  men  a  day  and  both  turn  you  down,  it 
is  discouraging,  but  if  the  number  is  twelve  and  ten 
turn  you  down  while  two  buy,  you  are  happy.  Get 
this  idea  of  average  well  rooted  in  your  mind. 

14.  Make  your  job  joyful.  Dwell  on  the  bright 
spots — cherish  the  friendships  you  have  made — talk 
about  your  successes — carry  a  light  heart  and  a  smile. 
Happiness  attracts.  You  have  the  best  company, 
goods,  territory,  friends,  chances,  times.  Blessed  is 
the  solicitor  for  the  Massachusetts  Mutual  who  knows, 
feels,  and  expresses  the  joy  of  his  job. 

15.  Put  yourself  where  your  prospect  will  likely  be 
ten,  twenty,  thirty,  or  more  years  hence.  You  must 
anticipate  conditions  if  you  expect  to  pry  open  stubborn 
wills.  Is  he  in  debt? — what  would  you  do?  Has  he 
great  business  cares? — how  would  you  feel?  Is  his 
wife  an  invalid? — how  would  you  act?  Has  he 
children  to  rear  and  educate? — what  would  you  think 
best?  And  so  on.  Then  you  can  see  from  his  eyes — 
then  you  can  fit  him  with  the  right  policy.  Get  into 
futures. 

16.  A  word  about  risks: 

1.  If  you  think  your  prospect's  business  is  hazard- 
ous— and  it  doesn't  come  under  the  list  printed  in 
Instruction  Manual — get  advice  from  the  Home 
Office  before  writing  his  application. 


114  MASSACHUSETTS   MUTUAL   TEXTBOOK 

2.  If  you  think  there  is  the  slightest  reason  why 
a  person  would  not  pass  because  of  some  slight 
physical  ailment,  talk  it  over  with  the  local 
examiner  before  making  the  Company  the  expense 
of  medical  fee.  Besides,  a  favorable  opinion  of 
the  local  doctor  might  help  you  close  him.  The 
Home  Office  appreciates  such  care  and  thought- 
fulness. 

3.  If  the  Company  rejects  an  application,  get  all 
the  additional  information  possible  and  ask  your 
manager  to  send  it  in.  Possibly  the  Home  Office 
has  misjudged  the  man.  It  is  as  anxious  for  good 
business  as  you  are. 

4.  If  the  individual  has  been  previously  rejected 
by  our  Company,  before  writing  another  applica- 
tion submit  additional  information  through  your 
Manager  and  wait  for  permission. 

5.  If  the  person  has  been  previously  rejected  by 
another  Company,  get  all  the  information  possible 
and  refer  same  to  the  Home  Office  before  sub- 
mitting application.  So  will  you  save  the  Com- 
pany expense  and  yourself  rejections.  Put  yourself 
in  every  instance  in  the  position  of  the  party  who 
is  to  pay  the  face  of  the  policy,  and  you  will  feel 
the  importance  of  great  care  in  selecting  risks. 


CHAPTER  XX 


STUDY 


Every  solicitor  for  the  Massachusetts  Mutual  must 
be  a  careful  student,  if  he  would  be  a  success.  Your 
study  must  be  conducted  along  four  lines: 

1.  Your  Business,  its  purpose,  plan,  development, 
growth,  destiny,  etc.  There  is  much  in  this  to 
broaden  your  horizon  and  make  a  bigger  man  of 
you.  Literature  of  all  kinds  is  available,  and  a 
few  minutes  a  day  will  give  you  a  large  fund  of 
valuable  information. 

2.  Your  Company.  You  must  know  this  well. 
Read  Book  of  Instructions — this  Textbook  again — 
visit  the  Home  Office  every  year  when  the  A  ssociation 
meets,  and  examine  the  workings  of  the  different 
departments— read  The  Radiator  all  the  way 
through  every  month, — and  any  other  material 
whereby  you  may  become  more  fully  acquainted 
with  our  Company.  The  more  you  study  it,  the 
better  satisfied  you  will  be  as  its  field  representative. 
We  have  a  most  wonderful  history  and  a  remarkable 
record. 

3.  Your  Work.  This  means  plans,  policies,  times, 
men,  other  companies,  insurance  journals,  com- 
petitors, territory,  systems,  etc.  You  will  need  to 
study  your  work  as  long  as  you  live,  for  there  are 
new  plans  and  new  things  to  learn  being  presented 
continually.  If  you  can't  learn,  better  quit  this 
business. 


116  MASSACHUSETTS   MUTUAL   TEXTBOOK 

4.  Yourself.  A  big  field.  You  know  your  faults — 
they  should  be  corrected.  You  know  your  virtues 
— they  should  be  developed.  Your  moods,  impulses, 
nerves,  feelings,  energies,  mentality,  affections,  in- 
fluences, etc.,  are  worthy  most  thorough  analysis. 
Know  yourself.  Many  applications  have  been  lost 
because  the  agent  was  not  in  proper  trim.  His 
personality  and  labor  did  not  co-ordinate. 

Study — learn — use — keep. 


CHAPTER  XXI 


WOMEN 


In  keeping  with  the  terms  of  its  Charter,  the 
Massachusetts  Mutual  Life  Insurance  Company  since 
its  organization  in  1851  has  insured,  at  the  same  rates 
as  men,  women  who  were  eligible.  Single  women 
and  widows  with  dependent  beneficiaries  will  be 
considered  on  all  plans  except  the  Term.  Married 
women  are  only  accepted  jointly  with  husband  (limit 
$2,500  and  on  any  plan  except  Term)  when  there  are 
children.  However,  the  limit  of  amount  is  varied 
under  exceptional  circumstances.  Married  women 
professionally  or  commercially  engaged  are,  ordinarily, 
acceptable  risks.  Disability  feature  is  not  granted  to 
women  applicants,  except  those  who  are  actual  wage 
earners. 

The  Home  Office  and  many  Agency  Managers 
realizing  the  ever-widening  field  for  new  business 
among  women  encourage  and  make  contracts  with 
women  to  become  solicitors  among  other  women  whose 
occupation,  profession,  or  other  conditions  give  promise 
of  good  results. 

Women  agents  have  carried  the  standard  of  the 
Massachusetts  Mutual  into  the  ever -enlarging  ranks  of 
independent  womanhood  for  many  years,  thereby 
bringing  blessings  to  thousands  of  lives. 

The  Company  desires  to  pay  tribute  to  the  high 
character  of  its  women  representatives,  and  most 
heartily  commends  to  every  agency  the  establishing 
and  maintaining  of  a  Woman's  Department  to  handle 
this  rapidly  developing  branch  of  our  business.  It 
believes — 


118  MASSACHUSETTS   MUTUAL  TEXTBOOK 

1.  That  women  are  becoming,  more  and  more,  a  part 
of  the  business  fabric  of  the  world  and  need 
insurance  protection  as  do  men;  and  we  should 
have  them. 

2.  That  women  solicitors  can  secure  such  business 
better  than  men,  and  we  should  have  them. 

3.  That,  when  possible,  women  physicians  should 
be  appointed  examiners  for  women  applicants,  and 
we  should  have  them. 

The  advent  of  thousands  of  women  into  positions 
formerly  filled  by  men  indicates  the  wise  foresight  of 
our  Company  in  opening  its  doors  without  rate 
restriction  to  this  class  of  insurants,  thereby  providing 
a  delightful  and  lucrative  field  for  hundreds  of  com- 
petent solicitors. 

The  general  information  and  specific  instruction 
contained  herein  apply  to  the  work  among  women  as 
well  as  among  men. 


CHAPTER  XXII 


TIME 


Every  underwriter  has  the  same  number  of  hours 
each  day,  but  not  all  use  them  in  the  same  way.  If 
one  sleeps  eight  and  plays  eight,  few  enough  remain 
for  intensive  work.  Many  successful  men,  however, 
do  not  cease  labor  under  twelve  to  fifteen  hours  per 
diem. 

Agents  seldom  comprehend  the  full  value  of  the 
rapidly  passing  hours  until  some  emergency  or  crisis 
arises  which  arouses  them  to  a  deeper  appreciation  of 
this  priceless  possession.  "Time  is  money,"  and  the 
solicitor  who  fully  realizes  this  will  not  waste  any  of  it. 

The  proper  use  of  time  makes  a  man  a  leader  instead 
of  one  led.  Makes  him  a  signal  success  instead  of 
a  dismal  failure.  When  properly  employed,  time  will 
more  than  compensate  for  all  defects  in  education, 
opportunities,  or  connections  either  social  or  business. 
The  most  capable — the  best  educated — the  strongest 
connected — the  richest  in  opportunity,  will  ingloriously 
fail  if  time  is  lightly  thrown  away. 

The  Massachusetts  Mutual  makes  no  hard  and  fast 
rules  to  govern  an  agent's  use  of  time.  It  takes  for 
granted  that  its  representative  will  have  energy  and 
ambition  sufficient  to  improve  each  working  hour.  It 
believes  that  efficiency  in  the  use  of  time  will  do  in 
one  month  what  quackery  cannot  accomplish  in  one 
year.  It  urges  each  agent,  not  only  to  use  all  his  time 
simply  to  fill  up  the  hours,  but  to  do  so  consistently. 
It  suggests  a  specific  plan  for  each  day — a  schedule  of 
trips,  appointments,  correspondence — and  living  up 
to  it. 


120  MASSACHUSETTS   MUTUAL  TEXTBOOK 

A  hit-or-miss,  indefinite  scheme  of  daily  work — not 
knowing  where  you  are  going  next, — results  in  nothing 
but  nervous  exhaustion.  Two  hours  with  each  oi  four 
persons  each  day  would  be  ideal  and  multiply  your 
production  by  two,  three,  possibly  four — double  the 
Company's  volume  and  no  one  be  a  bit  overworked. 
It  takes  some  head  piece  to  do  this,  but  it  will  pay. 

Study  out  a  system — use  card  index — make  appoint- 
ments ahead, — until  you  get  where  the  days  are  not 
long  enough.  Thrift  of  time  will  give  every  capable 
solicitor  in  this  business  a  net  profit  beyond  his  fondest 
dreams.     Idleness  is  the  surest  road  to  failure. 


CHAPTER  XXIII 


FIFTEEN   RULES   OF   HEALTH 

ADAPTED  BY  THE  NATIONAL  SAFETY  COUNCIL 
Air, 

1.  Insist  on  having  fresh  air  in  your  home  and 
where  you  work, 

2.  Wear  light,  loose  clothing. 

3.  Spend  part  of  your  time  in  the  open  air. 

4.  Have  lots  of  fresh  air  where  you  sleep. 

5.  Breathe  deeply. 

Food. 

6.  Don't  eat  too  much. 

7.  Eat  various  kinds  of  food. 

8.  Don't  eat  much  meat. 

9.  Eat  slowly — chew  your  food  well. 

10.  Have  your  bowels  move  each  day. 

Habits. 

11.  Stand,  sit,  and  walk  erect. 

12.  Don't  dope  yourself  with  drugs. 

13.  Keep  away  from  contagious  diseases. 

Activity. 

14.  Work  hard,  but  play  and  rest,  too. 

15.  Be  cheerful.     Try  not  to  worry. 


CHAPTER  XXIV 


A   SALESMAN'S  PRAYER 

The  following  contains  much  that  every  salesman 
needs.  Read  it  every  night  after  the  day's  work  is 
done. 

Teach  me  never  to  wish  for  things,  but  to  set  out  to 
attain  them  instead. 

Teach  me  to  speak  only  of  happiness  and  pleasure, 
and  never  to  cry  for  the  moon. 

I  pray  that  I  may  never  become  diseased  with  the 
malady  of  meddling  into  the  private  affairs  of  other 
men. 

Teach  me  to  dilute  my  work  with  play,  to  brighten 
my  seriousness  with  jest,  and  never  to  take  myself  so 
seriously  that  I  crowd  from  my  life  the  joys  and 
pleasures  that  are  mine  by  heritage. 

Teach  me  to  get  the  most  from  the  companionship 
of  the  stars  and  trees  and  from  my  walks  and  talks 
with  men. 

Teach  me  to  be  greater  than  my  blunders  and  to 
absorb  the  philosophy  that  folly  gives  me  the  vision 
to  acquire. 

May  I  never  prophesy  failure  for  other  men, 

And  may  I  always  remember  that  one  divine 
moment  or  hour  carries  us  further  along  on  our  way 
than  the  tide  of  a  day  misspent  can  carry  us  back. 

Teach  me  to  be  more  just  and  considerate  of  others, 
in  order  that  I  may  have  the  sympathy  to  influence  and 
direct  them, 


A  salesman's  prayer  123 

And  may  I  never  discuss  the  character  of  any  man 
behind  a  closed  door — 

Thus  giving  him  no  opportunity  to  defend  himself 
from  the  sin  I  have  committed  against  him  and 
against  my  finer  and  better  self. 

May  I  never  lose  control  of  myself  because  other 
men  do  not  believe  as  I  do. 

May  I  always  judge  a  tree  by  its  fruit  and  men  and 
women  by  their  work  and  by  the  things  to  which 
they  aspire. 

Teach  me  never  to  make  myself  a  nuisance  by 
advising  other  men  how  to  live,  the  style  of  clothes  to 
wear,  and  what  to  eat  and  drink. 

May  I  understand  more  and  more  that  an  agile 
tongue  is  the  evidence  of  a  shattered  and  sickly  mind — 
a  mind  saturated  with  suspicion  for  my  neighbor 
and  for  those  whom  I  pretend  to  love  and  befriend. 

Teach  me  to  forget  the  mistakes  I  have  made  and 
the  mistakes  of  other  men. 

And  may  I  learn  that  it  is  best  to  write  the  failings 
of  men  and  women  in  the  sand,  near  the  water's  edge. 

Teach  me  never  to  wear  the  double  smile  and  never 
to  go  tiptoeing  about  with  moccasins  to  malign  and 
criticise  and  to  carry  "news,"  for  these  things  ill 
become  men  and  women. 

May  my  imagination  never  grow  dim,  and  may  there 
always  be  a  place  in  my  mind  for  the  Butterfly  of 
Fancy  to  spread  its  wings  and  fly. 

— Salesmanship. 


124  MASSACHUSETTS   MUTUAL  TEXTBOOK 


A   FINAL   WORD 

Have  a  definite  statute  of  morals,  and  live  up  to  it  in 
your  daily  thoughts,  words,  and  deeds.  Shackle 
your  vanity,  else  you  might  become  a  conceited 
coxcomb;  husband  your  speech,  lest  a  single  word 
fails  to  reach  its  mark;  cherish  your  convictions,  that 
they  may  abide  with  you  vigorous  and  true,  but, 
at  the  right  time  and  place,  let  yourself  out  with  the 
earnestness  of  perfect  faith  in  your  energies  and 
principles.  If  you  are  possessed  of  knowledge — 
common  knowledge  of  common  things  learned  from 
study,  observation,  and  experience — you  will  not 
only  not  fail,  but  you  will  achieve  your  full  measure  of 
success. 


INDEX 

Page 

Acquaintance,  How  to  Increase. .    88 

Actuary 17 

Advance  Premium  Receipt 23 

Agencies 21 

Agent's  Book  of  Instructions 115 

Amount  at  Risk 23 

Annual  Dividends 46 

Annuities 61-64 

Benefits  Under 63 

Deferred 62 

I  mmediate  Life 61 

Joint  Life  and  Survivor 63 

Armstrong  Investigation 44-45 

Assessment  Insurance 34 

Principles  of 34 

Unlawful  in.  Massachusetts 50 

Assets 23 

Assignee 23 

Assignment 23 

Beneficiary 23 

Cash  Surrender  Value 23 

Changes .    . ' 24 

Closing 103-107 

Committees 19 

Continuous  Monthly  Income 65 

Counsel 18 

Definitions 22-37 

Digest  of  Massachusetts  Insurance  Laws 41-51 

Directors 16 

Discounting  Premiums 24 

Dividends 24 

Elizur  Wright. 38-40 

Endowment  Option 59 

Endowment  Policy 25 

Errors 25 

Excuses  Offered 104-107 

Expectancy 25 

Expenses 49 

Extended  Insurance '. ; 25 


126  INDEX 

Page 

Final  Word 124 

Following  Up 108 

Gross  Premium 25 

History  of  Life  Insurance 7-9 

Incontestable 26 

Industrial  Insurance 26 

Inspection 26 

Installment  Options 66-73 

Option  A 66 

Option  B 68 

Option  C 69 

Option  D 71 

Insurable  Interest 26 

Investments 19-20 

Bonds 19 

Mortgage  Loans 19 

Policy  Loans 20 

Joint  Life  Policy 26 

Kinds  of  Insurance 34-37 

Assessment  System 34 

Level  Premium  System 36 

Mutual 37 

Natural  Premium  System 35 

Stock 37 

Lapse 26 

Laws  of  Massachusetts 41-51 

Acts  of  1858  and  1861 42 

Act  of  1880 43 

Act  of  1887. 43 

Act  of  1894 44 

Acts  of  1896  and  1900 44 

Act  of  1907 45 

Non-forfeiture  Laws 42 

Legal  Reserve 27 

Level  Premium 27 

Level  Premium  Insurance 36 

Liabilities 27 

Life 6 

Life  Insurance 22,  34-37 

Basic  Principles  of 22 

Kinds  of 34-37 

Assessment  System 34 

Level  Premium  System 36 

Mutual 37 

Natural  Premium  System 35 

Stock 37 


INDEX  127 

Page 

Limited  Payment  Life  Policy 27 

Loading 27 

Loan  Value 28 

Massachusetts 

Digest  of  Laws  of 41-51 

First  Commissioner  of 38 

Inauguration  of  Insurance  Department 39 

Peculiar  Benefits  of  Laws  of 48 

Massachusetts  General  Hospital  Insurance  Company 50-51 

Massachusetts  Mutual  Life  Insurance  Company 

Aims 10-12 

Capital  Stock 12 

Character 14-15 

Charter .' 12 

Growth 13-14 

Home  Office 12 

Officials 16-19 

Maturity 28 

Medical  Director 17 

Medical  Examiners 21 

Mortality 28 

Mortality  Table 28 

Mutual  Company 37 

Natural  Premium 29 

Net  Premium 29 

Non-f  orfeitable 29 

"Not  Now" 104-107 

Objections  Offered  by  Prospects 104—107 

Officers  of  Company 16-19 

Actuary 17 

Counsel 18 

Directors 16 

Medical  Director 17 

President 16 

Secretary 17 

Superintendent  of  Agents 18 

Superintendent  of  Loans 18 

"Old  Line"  Company 29 

Ordinary  Life 29 

Paid-up  Additions 29 

Paid-up  Value 30 

Policy  Contracts 52-53 

Annuities 61-64 

Cardinal  Features 54-60 

Endowment  Option 59 

Kinds S3 

Ordinary  Life 53 


128  INDEX 

Page 

Ten  Year  Term 54 

Twenty  Payment  Life 54 

Twenty  Year  Endowment 54 

Valuation 47 

Policy 30 

Premium 30 

President 16 

Prospects 91-97 

Provision  for  Waiver  of  Premium 58-59 

Radiator 115 

Rebate 30 

Renewable  Term 31 

Renewal  Premium 31 

Representatives  of  Company 11 

Reserve .31 

Restoration 31 

Reversionary  Additions 31 

Risks 113 

Rules  of  Health 121 

Salesmanship 78-82 

Salesman's  Prayer 122-123 

Secretary 17 

Selling 83-114 

Approaching  the  Known 98-100 

Approaching  the  Unknown 101-102 

Following  up 108 

Means  of  Increasing  Acquaintance 88 

Methods 99-100 

Practical  Suggestions 110-114 

Preparation 83 

Prospects ' 91 

Suggestions  about  Closing 103 

State  Supervision 31 

Stock  Company 37 

Study 115-116 

Superintendent  of  Agents 18 

Superintendent  of  Loans 18 

Surplus 32 

Talking  Points 74-77 

Taxes 33 

Temporary  Term  Insurance 33 

Term  Policy 33 

Time,  Use  of 119-120 

Trustee 34 

Valuation  of  Policies 47 

Women 117-118 

Wright,  Elizur 38-40 


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